Category: AutomotiveUnited States

AV Readiness Increases After a Two-Year Decline, JD Power Finds

2024-10-22

jillian.breska

TROY, Mich.: 22 Oct. 2024 — The automotive industry is seeing small signs of increased consumer confidence in fully automated self-driving vehicles, although overall confidence remains low, according to the JD Power 2024 U.S. Mobility Confidence Index (MCI) Study,^SM released today. After a two-year decline, the index score for consumer automated vehicle (AV) readiness increases 2 points to 39 (on a 100-point scale), which is where it was in 2022.

While the index has started to move in the right direction, the pace with which consumers accept the technology remains relatively flat among the general population and safety continues to affect consumer confidence. To drive positive change, 83% of consumers say they want more safety statistics regarding the technology before riding and 86% say they want the ability to take control of the vehicle if needed. Until these issues are addressed and consumer expectations are met, gains in consumer confidence with the technology will remain low.

“This year’s improvement is minimal because there are still many unmet needs required to boost consumer confidence,” said Lisa Boor, senior manager of auto benchmarking and mobility development at JD Power. “Repeated and consistent reporting of safety findings over time—with independent oversight—will aid acceptance. Furthermore, addressing persistent concerns regarding insurance costs and data privacy also are paramount.”

Data privacy and hacking remain top concerns as 64% of consumers express concern that the data collected in the vehicle is not safe and secure and 80% want to understand what is being done to prevent fully automated, self-driving vehicles from being hacked. In fact, this issue is becoming so important to consumers that 40% (definitely and probably will) indicated that the automaker’s data protection policy will be a reason to purchase one brand over another when shopping for their next vehicle.

“Consumers are increasingly concerned with data privacy and this study shows a strong link to fully automated self-driving vehicles,” said Bryan Reimer, Ph.D., research scientist in the AgeLab at the MIT Center for Transportation and Logistics and a founder of MIT’s Advanced Vehicle Technology (AVT) Consortium. “Data security and transparency regarding data use are becoming increasingly important as a foundation for building trust in technology and connected digital solutions. Trust is built over time but can be quickly eroded. The news media’s attention to a recent failure by one automotive manufacturer to safeguard drivers’ privacy is likely provoking anxiety among automotive consumers.”

Following are some key findings of the 2024 study: 

• Drones in demand: This year’s study also measures consumer confidence with various ways that automated self-driving technology may be deployed for air transportation, including drones and air taxis (i.e., aircraft with vertical takeoff and landing capabilities). Confidence in having packages delivered using an automated drone is 34%, more than double the rate of riding in a fully automated, self-driving air taxi (16%).
• Insurance per ride unexpected: Nearly three-fourths (71%) of consumers say they don’t expect to acquire insurance on a pay-per-ride basis when utilizing a robotaxi service. More than half (57%) agree that the vehicle owner will need liability coverage for any fully automated, self-driving vehicle.
• Parents of teens want ADAS technology: Parents of teen drivers are roughly twice as comfortable letting them drive the household vehicle (50%) than ride in a robotaxi (26%) or use Uber teen (29%). However, 39% of parents say they want the household vehicle to be equipped with Active Driver Assistance Systems (ADAS) technology for safety reasons.

The JD Power 2024 Mobility Confidence Index Study is based on responses from 3,000 vehicle owners in the United States who are age 18 or older, and who completed an online survey. The study results are balanced to basic census demographics to be nationally representative. The study was fielded in August 2024 and is based on seven unique attributes of consumer comfort with fully automated, self-driving vehicles. Since 2019, JD Power has provided the only comprehensive measurement of consumer readiness for fully automated, self-driving vehicles in several categories: personal vehicles; commercial vehicles; public transit; riding if unable to drive due to age or injury; sharing the road with other AVs; testing of AV technology and consumer purchase intent.

About JD Power 
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

To learn more about the U.S. Mobility Confidence Index Study, visit https://www.jdpower.com/business/automotive/us-mobility-confidence-index-mci-study.

About the MIT Advanced Vehicle Technology Consortium 
The Advanced Vehicle Technology (AVT) Consortium is an academic-industry partnership founded in 2015 within the Massachusetts Institute of Technology (MIT) Center for Transportation and Logistics. It is supported by over 25 different automakers, insurance companies, suppliers, and research organizations through a pre-competitive collaboration designed to develop a data-driven understanding of drivers’ behavior with, and utilization of, vehicle automation, driver safety systems, and other technologies. AVT research aims to support a future of safe, convenient, and sustainable mobility through more effective human-centered vehicle technology development and consumer understanding of appropriate technology usage. To learn more about the AVT consortium and its members, visit avt.mit.edu.

Media Relations Contacts 
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]
Benjy Kantor, MIT Center for Transportation & Logistics; 857-231-4005; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

 

October New-Vehicle Sales Expected to Rise with 16.1M SAAR; Consumer Spending on Vehicles Up 11.8% Year Over Year

2024-10-23

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for October 2024, including retail and non-retail transactions, are projected to reach 1,327,600, a 2.1% increase from October 2023 on a selling day adjusted basis, according to a joint forecast from JD Power and GlobalData. October 2024 has 27 selling days, 2 more than October 2023. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 10.3% from 2023.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 16.1 million units, up 0.6 million units from October 2023.

The Retail Sales Forecast

New-vehicle retail sales for October 2024 are expected to increase from a year ago. Retail sales of new vehicles are expected to reach 1,136,700, a 5.9% increase from October 2023 when adjusting for selling days. Comparing the same sales volume without adjusting for the number of selling days translates to an increase of 14.3% from 2023.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“October results show a solid sales performance, with retail sales growing nearly 6% year over year and a projected total SAAR of 16.1 million. While transaction prices and interest rates continue to decline, monthly payments are up slightly, largely due to reduced trade-in equity driven by falling used-vehicle prices. Despite this, consumers are expected to spend approximately $48.3 billion on new vehicles this month, an increase of 11.8% compared with October 2023.

“Retail inventory is projected to be 1.9 million units, a 4% increase from September and a 25.1% increase from October 2023. Increasing inventory levels are driving deeper discounts from both manufacturers and retailers. However, the availability of inventory remains uneven across different brands and models, with certain high-volume vehicles still experiencing shortages.”

The average new-vehicle retail transaction price has fallen from a year ago due to higher manufacturer incentives, larger retailer discounts and increased availability of lower-priced vehicles. Transaction prices are trending towards $44,904—down $739 or 1.6%—from October 2023. The combination of higher retail sales and lower transaction prices means that buyers are on track to spend nearly $48.3 billion on new vehicles this month—11.8% higher than October 2023.

“Total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,245, down 27.3% from October 2023. Rising inventory is the primary factor behind the profit decline and fewer vehicles are selling above the manufacturer’s suggested retail price (MSRP). Thus far, only 12.7% of new vehicles have been sold above MSRP, which is down from 27.1% in October 2023.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $2.4 billion, down 17.4% from October 2023.

“Increased inventory means fewer vehicles are being pre-sold by retailers, with more shoppers able to buy directly off dealer lots. JD Power forecasts that 29.7% of vehicles will sell within 10 days of arriving at the dealership, down from a peak of 58% in March 2022. The average time a new vehicle remains in the dealer’s possession before sale is expected to be 50 days, up from 20 days a year ago.”

Manufacturer discounts are continuing to rise. The average incentive spend per vehicle is expected to grow 70.5% from October 2023 and is on track to reach $3,149. Expressed as a percentage of MSRP, incentive spending is currently at 6.3%, an increase of 2.5 percentage points from a year ago. Spending increased by $24 per unit from September 2024. 

“One of the drivers of higher incentive spending from a year ago is the increased availability of discounted lease payments. This month, leasing is expected to account for 23.2% of retail sales, up 2.3 percentage points from 20.8% in October 2023.

“Although appealing lease offers are boosting the lease mix, the industry is still grappling with the lasting effect of diminished leasing activity from three years ago. The number of leases set to expire this October is down 10.7% compared with September and 35.4% lower than in October 2023. With fewer leases maturing, there are less opportunities to drive sales.”

Average monthly finance payments this month are on pace to be $738, up $14 from October 2023. The average interest rate for new-vehicle loans is expected to be 6.7%, down 68 basis points from a year ago. Monthly payments increasing is a result of a drop in trade-in equity, even though transaction prices and interest rates are falling.”

So far in October, average used-vehicle retail prices are $28,472, down $669 (-2.3%) from a year ago. The decline in used-vehicle values is translating to lower trade-in equity for owners, now trending towards $7,909, which is down $911 from a year ago.

“November traditionally marks the beginning of the holiday sales event season for the automotive industry. This period often sees a focus on premium vehicles, accompanied by manufacturer-backed lease incentives and pricing discounts. As the number of leases expiring in November and December is projected to be nearly 40% lower than the same period a year ago, this holiday season may require innovative strategies to entice customers into acquiring a new vehicle.”

Sales & SAAR Comparison

U.S. New Vehicle	October 20241, 2	September 2024	October 2023
Retail Sales	1,136,718 units (5.9% higher than October 2023)2	991,502 units	994,112 units
Total Sales	1,327,591 units (2.1% higher than October 2023)2	1,179,680 units	1,203,490 units
Retail SAAR	13.8 million units	13.7 million units	12.7 million units
Total SAAR	16.1 million units	15.9 million units	15.4 million units

¹ Figures cited for October 2024 are forecasted based on the first 17 selling days of the month.
² October 2024 has 27 selling days, two more than October 2023.

The Details

• The average new-vehicle retail transaction price in October is expected to reach $44,904, down $739 from October 2023. The high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in October is expected to reach $3,149, up $1,302 from October 2023. Spending as a percentage of the average MSRP is expected to increase to 6.3%, up 2.5 percentage points from October 2023.
• Average incentive spending per unit on trucks/SUVs in September is expected to be $3,338, up $1,385 from a year ago, while the average spending on cars is expected to be $2,309, up $901 from a year ago.
• Retail buyers are on pace to spend $48.3 billion on new vehicles, up $5.1 billion from October 2023.
• Trucks/SUVs are on pace to account for 78.3% of new-vehicle retail sales in October.
• Fleet sales are expected to total 190,872 units in October, down 15.6% from October 2023. Fleet volume is expected to account for 14.4% of total light-vehicle sales, down 3 percentage points from a year ago.
• Average interest rates for new-vehicle loans are expected to be 6.7%, down 68 basis points from a year ago.

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“EV share of the retail market increased 0.8 percentage points in September, rising to 10.2%.  The fourth quarter is when the industry will see the effect of new model year 2025 vehicles entering the market.  EV model year transition is behind gas-powered models as only 5% of EVs have transitioned to model year 2025 vs. 37% for gas-powered models. A later model-year transition typically brings more incentives to clear out the older model year, which means OEMs risk having to spend more money to move the older inventory.

“EV Incentives as a percentage of MSRP are currently averaging 11.5%—up from 4.7% this time a year ago. In comparison, similar incentives for gas-powered vehicles are averaging almost 6%, up from 3.8% a year ago. Right now, 83% of EV inventory is model year 2024 and 42% of gas-powered inventory is of model year 2024.

 “While typical changeover, incentives and inventory would imply the continued pricing actions to move older vehicles, the result of the upcoming election might also influence policy changes, consumer confidence and consideration of EVs.”

Global Sales Outlook

Jeff Schuster, vice president of research, automotive at GlobalData:
“The global light-vehicle selling rate for September was 89 million units, slightly lower than August but consistent with the past five months. September saw a 4.2% decrease year over year, marking the fourth consecutive month of negative performance compared with the same period in 2023. Year-to-date volume is now only 0.3% higher than in 2023, putting annual growth at risk as we move into the fourth quarter.

Following the recent trend, Argentina, Brazil and Russia were the only markets showing positive growth in September. Argentina is benefiting from reform set by the new administration and, with expected interest-rate increases in Russia, some sales are likely being pulled forward. North America experienced a 10% decline with the absence of the Labor Day weekend making year-over-year comparisons challenging. Both China (-6%) and Western Europe (-4%) contributed to the overall decline in September.

“Year-over-year declines are anticipated to reverse in October, with volume projected to increase 4% and the selling rate expected to surpass 90 million units. Several markets are forecasted to post double-digit growth in October, led by Europe, North America, Argentina, Brazil, Japan and India. China is also expected to see significant gains.

“As global light-vehicle sales show signs of stabilizing, some of the acceleration previously expected in the fourth quarter has been tempered. The 2024 forecast now stands at 88.0 million units, down by 500,000 from the previous month, with revisions made for China, Western Europe and the United States. The increase from 2023 is now projected at 1.4% due to existing risk factors. Growth is still anticipated to pick up in 2025 as pricing moderates and economic risks are expected to diminish. The forecast for 2025 is 91.1 million units, representing a 3.5% increase from 2024.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

About GlobalData https://www.globaldata.com

 

Inventory and Pricing Drive Gains in Sales Satisfaction but Other Areas Have Modest Improvement, JD Power Finds 

2024-11-06

jillian.breska

TROY, Mich.: 7 Nov. 2024 — Customer satisfaction with the vehicle purchase process continues to rise as new-vehicle inventory and pricing improve year over year, according to the JD Power 2024 U.S. Sales Satisfaction Index (SSI) Study, ^SM released today. This year, overall customer satisfaction with the vehicle purchase experience is 801 (on a 1,000-point scale), up from 793 a year ago. Even so, gains in other aspects of the purchase process such as personnel, paperwork and delivery are markedly smaller.

“In 2023, improvements in new-vehicle inventory and pricing moved customer satisfaction in an upward trajectory from the lows of 2022, and that’s apparent again this year,” said Stewart Stropp, vice president of automotive retail at JD Power. “It marks a return to form. As shoppers see a wider variety of vehicles to choose from, pricing becomes more competitive across the market. But this year’s study shows satisfaction with other parts of the sales experience has not improved nearly as much. Plenty of opportunity remains to optimize the path to purchase.”

Following are some key findings of the 2024 study:

• Percentage of buyers paying above MSRP declines considerably: With replenished inventory, buyers are rarely paying more than the suggested retail price for vehicles. Among mass market buyers, only 8% paid more than MSRP—an appreciable decrease from 15% a year ago. Among premium vehicle buyers, only 6% paid more than MSRP, down from 10% in 2023.
• Meeting key performance indicators (KPIs): While 57% of buyers say nine or 10 of the top 10 KPIs were met during their sales experience, 43% say eight or fewer were met, resulting in substantially different levels of satisfaction. When nine or 10 KPIs are met, Buyer Index satisfaction averages 917. When seven or eight KPIs are met, the average drops to 827—fully 90 points lower. Ensuring all KPIs are completed is key to optimal satisfaction. Top KPIs include sales consultants completely understanding customer needs; vehicle condition upon delivery; and personnel effectively using technology.
• BEV buyers still less satisfied than ICE buyers: While the gap between internal combustion engine vehicle (ICE) and battery electric vehicle (BEV) buyer satisfaction is getting smaller, BEV buyers are still notably less satisfied. Buyer Index satisfaction among mass market ICE vehicle buyers is 857 but drops to 822 among mass market BEV buyers—and a similar pattern exists among buyers of premium vehicles. Furthermore, both mass market and premium BEV buyers continue to be less satisfied with dealer staff knowledge and expertise. Tesla buyers, in particular, have markedly lower satisfaction with the effectiveness of the vehicle features explanation.

Study Rankings

Porsche ranks highest in sales satisfaction among premium brands for a second consecutive year, with a score of 851. Infiniti (840) ranks second and Jaguar (838) ranks third.

MINI ranks highestin sales satisfaction among mass market brands, with a score of 829. Buick (827) ranks second and Subaru (825) ranks third. 

Segment Awards

The following are the highest-ranked brands in each segment:

Premium Car: Porsche (for a second consecutive year)
Premium SUV: Porsche (for a second consecutive year)
Mass Market Car: Nissan
Mass Market SUV/Minivan: Buick
Mass Market Truck: GMC (for a second consecutive year)

Now in its 39^th year, the U.S. Sales Satisfaction Index (SSI) Study measures satisfaction with the sales experience among new-vehicle buyers and rejecters (those who shop a dealership and purchase elsewhere). Buyer satisfaction is based on six factors (in order of importance): delivery process; dealer personnel; working out the deal; paperwork completion; dealership facility; and dealership website. Rejecter satisfaction is based on five factors: salesperson; price; facility; variety of inventory; and negotiation. 

The 2024 U.S. Sales Satisfaction Index (SSI) Study is based on responses from 34,596 buyers who purchased or leased their new vehicle from March through May 2024. The study is a comprehensive analysis of the new-vehicle purchase experience and measures customer satisfaction with the selling dealer (satisfaction among buyers). The study also measures satisfaction with brands and dealerships that were shopped but ultimately rejected in favor of the selling dealership (satisfaction among rejecters). The study was fielded from July through September 2024.

For more information about the U.S. Sales Satisfaction Index (SSI) Study, visit https://www.jdpower.com/business/automotive/us-sales-satisfaction-index-ssi-study.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info 

 

It’s Taken Five Years, but Vehicle Multimedia Problems Finally Show Improvement, JD Power Finds

2024-09-11

jillian.breska

TROY, Mich.: 12 Sept. 2024 — In 2020, overall multimedia problems per 100 vehicles (PP100) was at 39.1 and steadily increased until 2024 with 43.7 PP100, excluding repair data, according to the JD Power 2024 U.S. Multimedia Quality and Satisfaction Study,^SM released today. A lower score reflects higher quality.

This year also marks the first year in three years that infotainment drops from being 25% of the industry problems. The biggest improvements amongst the top 10 problems cited by drivers are voice recognition, lack of USB ports and inconsistent volume.

“It is great to see OEMs and suppliers taking action on what were typically the biggest contributors to the increases in vehicle multimedia quality problems,” said Ashley Edgar, senior director of automotive benchmarking at JD Power. “Previously long-standing issues have been addressed and those updates can be seen in the problem decreases. Looking ahead, to continue decreasing problems, further optimization of Apple Car Play and Android Auto should remain a top priority.”

The highest-ranked vehicles in each segment are:

• Midsize/Large: Hyundai Santa Fe
• Midsize/Large Premium: Cadillac Escalade
• Small/Compact: Mitsubishi Outlander
• Small/Compact Premium: Cadillac CT4

The 2024 U.S. Multimedia Quality and Satisfaction Study is based on responses from 99,144 purchasers and lessees of new 2024 model-year vehicles who were surveyed after 90 days of ownership. The study was fielded from July 2023 through May 2024.

For more information about the U.S. Multimedia Quality and Satisfaction Study, visit  https://www.jdpower.com/business/automotive/us-multimedia-quality-and-satisfaction-study.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

 

As Inventory Levels Recover, Loyal Customers Returning to Their Brand of Choice, JD Power Finds

2024-09-24

jillian.breska

TROY, Mich.: 25 Sept. 2024 — Perennial brand loyalty leaders including Toyota, Honda and Lexus have each been able to grow their respective shares of loyal customers amid stagnation experienced by other brands, according to the JD Power 2024 U.S. Automotive Brand Loyalty Study,^SM released today.

“Amid ongoing inventory shortages, the most loyal customers actually stayed out of the market if they were unable to get their desired vehicle,” said Tyson Jominy, vice president of data & analytics at JD Power. “Now that inventory levels are recovering, customers are coming back. In particular, Toyota and Honda are benefitting from increased availability of hybrid vehicles, with Honda owners swapping out their gas-powered vehicles for hybrids at nearly triple the rate of the industry average. Lexus is also benefitting from strengthened residual values, which are helping drive loyalty for the brand despite premium brands as a whole experiencing a plateau this year.”

Highest-Ranking Brands
Porsche ranks highest among premium brand car owners for a third consecutive year, with a 57.5% loyalty rate. Mercedes-Benz (49.0%) ranks second.

Lexus ranks highest among premium brand SUV owners with a 60.2% loyalty rate. BMW (55.8%) ranks second.

Toyota ranks highest among mass market brand car owners for a third consecutive year, with a 62.5% loyalty rate. Honda (58.8%) ranks second.

Honda ranks highest among mass market brand SUV owners with a 64.2% loyalty rate. Subaru (62.6%) ranks second.

Ford ranks highest among truck owners for a third consecutive year, with a 65.1% loyalty rate—the highest loyalty rate in the study. Toyota (60.8%) ranks second.

The study, now in its sixth year, uses data from the Power Information Network to calculate whether an owner purchased the same brand after trading in an existing vehicle on a new vehicle. Customer loyalty is based on the percentage of vehicle owners who choose the same brand when trading in or purchasing their next vehicle. Only sales at new-vehicle franchised dealers qualify. The study includes brand loyalty across five segments: premium car; premium SUV; mass market car; mass market SUV; and truck.

The 2024 study calculations are based on transaction data from September 2023 through August 2024 and include all model years traded in.

For more information about the U.S. Automotive Brand Loyalty Study, visit  https://www.jdpower.com/business/us-automotive-brand-loyalty-study.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

 

September Sales Decline Due to Timing of Labor Day Weekend But Combined August-September Results Show Retail Growth

2024-09-26

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for September 2024, including retail and non-retail transactions, are projected to reach 1,164,900, a 1.8% decrease from September 2023 on a selling day adjusted basis, according to a joint forecast from JD Power and GlobalData. September 2024 has 23 selling days, three fewer than September 2023. Comparing the same sales volume without adjusting for the number of selling days translates to a decrease of 13.2% from 2023.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 15.8 million units, flat from September 2023.

New-vehicle total sales in Q3 2024 are projected to reach 3,882,600 units, a 0.2% increase from Q3 2023 with two less selling days.

The Retail Sales Forecast

New-vehicle retail sales for September 2024 are expected to decrease from a year ago. Retail sales of new vehicles are expected to reach 960,500, a 3.9% decrease from September 2023 when adjusting for selling days. Comparing the same sales volume without adjusting for the number of selling days translates to a decrease of 15% from 2023.

New-vehicle retail sales in Q3 2024 are projected to reach 3,263,500 units, a 1.4% increase from Q3 2023 with two less selling days.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“September sales volumes will be lower than a year ago because of a calendar quirk that saw the Labor Day holiday weekend fall into the August sales month. This boosted August’s sales but will diminish September’s sales from a year ago. When August and September results are combined, retail sales increase 2.6% year over year.

“Retail inventory is projected to be 1.8 million units, a 6.2% increase from August and a 30.7% increase from September 2023. Rising inventories are leading to larger discounts from both manufacturers and retailers. However, the inventory situation continues to be inconsistent across brands and models, with some popular vehicles remaining in short supply.”

The average new-vehicle retail transaction price has fallen from a year ago due to higher manufacturer incentives, larger retailer discounts and increased availability of lower-priced vehicles. Transaction prices are trending towards $44,467—down $1,296 or 2.8%—from September 2023. The combination of lower retail sales and lower transaction prices means that buyers are on track to spend nearly $40.4 billion on new vehicles this month—16.8% lower than September 2023.

“Total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,294, down 29% from September 2023. Rising inventory is the primary factor behind the profit decline and fewer vehicles are selling above the manufacturer’s suggested retail price (MSRP). Thus far, only 13.6% of new vehicles have been sold above MSRP, which is down from 26.1% in September 2023.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $2.1 billion, down 39% from September 2023.

“Increased inventory means fewer vehicles are being pre-sold by retailers, with more shoppers able to buy directly off dealer lots. JD Power forecasts that 32.4% of vehicles will sell within 10 days of arriving at the dealership, down from a peak of 58% in March 2022. The average time a new vehicle remains in the dealer’s possession before sale is expected to be 48 days, up from 29 days a year ago.”

Manufacturer discounts are continuing to rise. The average incentive spend per vehicle has grown 63.2% from September 2023 and is currently on track to reach $3,047. Expressed as a percentage of MSRP, incentive spending is currently at 6.2%, an increase of 2.4 percentage points from a year ago. Spending has decreased by $21 per unit from August 2024. 

“One of the drivers of higher incentive spending from a year ago is the increased availability of discounted lease payments. This month, leasing is expected to account for 21.8% of retail sales, up a single percentage point from 20.8% in September 2023.

“While attractive lease deals are driving lease mix upward, the industry continues to contend with the long-term effects of reduced leasing activity from three years ago. The number of leases expiring this September is 13.1% lower than in August and 28.1% lower than September 2023. Fewer expiring leases mean fewer opportunities for new sales.”

Average monthly finance payments this month are on pace to be $734, up $11 from September 2023. The average interest rate for new-vehicle loans is expected to be 6.84%, down 46 basis points from a year ago.

So far in September, average used-vehicle retail prices are $28,465, reflecting a decrease of 3.2%—down $937—from a year ago. The decline in used-vehicle values is translating to lower trade-in equity for owners, now trending towards $7,886, which is down $1,120 from a year ago.

“In October, attention will center on the evolving effect of recent interest rate cuts. While the rate adjustment is a positive for the industry, the effect will be neither immediate nor linear whether it’s improving vehicle affordability for consumers, reducing the cost of low APR deals for manufacturers or helping retailers with floorplan expense. Furthermore, the effect on monthly payments will be blunted by the ongoing decline in trade-in equity. The drop in trade-in equity is one of the reasons why monthly payments are up from a year ago even though transaction prices are falling.”

Sales & SAAR Comparison

U.S. New Vehicle	September 20241, 2	August 2024	September 2023
Retail Sales	960,481 units (3.9% lower than September 2023)2	1,232,876 units	1,129,659 units
Total Sales	1,164,897 units (1.8% lower than September 2023)2	1,419,622 units	1,341,281 units
Retail SAAR	13.3 million units	12.3 million units	13.6 million units
Total SAAR	15.8 million units	15.2 million units	15.8 million units

¹ Figures cited for September 2024 are forecasted based on the first 16 selling days of the month.
² September 2024 has 23 selling days, three fewer than September 2023.

The Details

• The average new-vehicle retail transaction price in September is expected to reach $44,467, down $1,296 from September 2023. The high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in September is expected to reach $3,047, up $1,210 from September 2023. Spending as a percentage of the average MSRP is expected to increase to 6.2%, up 2.4 percentage points from September 2023.
• Average incentive spending per unit on trucks/SUVs in September is expected to be $3,243, up $1,296 from a year ago, while the average spending on cars is expected to be $2,208, up $803 from a year ago.
• Retail buyers are on pace to spend $40.4 billion on new vehicles, down $8.2 billion from September 2023.
• Trucks/SUVs are on pace to account for 80.8% of new-vehicle retail sales in September.
• Fleet sales are expected to total 204,416 units in September, up 9.2% from September 2023. Fleet volume is expected to account for 17.5% of total light-vehicle sales, up 1.8 percentage points from a year ago.
• Average interest rates for new-vehicle loans are expected to be 6.84%, down 46 basis points from a year ago.

 

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“In September, the interest in EVs by new-vehicle shoppers reached a low point for the year. Just 21.7% of new-vehicle shoppers said they were ‘very likely’ to consider an EV for their next new-vehicle purchase, a 4.2-percentage-point drop from a year ago. Some might call it the ‘Summertime EV Blues.’

“Even though fewer shoppers are considering EVs, the sales share for EVs peaked at 9.4% in August and has held through mid-September, which is a pretty healthy position. The contradiction of lower interest and higher sales will lead many to ask, ‘How can that be?’ The answer is simple: incredibly discounted transaction prices. Buyers are always looking for a deal, and what they’re paying now for an EV—thanks in part to federal incentives—is less than the comparable segment average price in both mass market and premium segments.”

Global Sales Outlook

Jeff Schuster, vice president of research, automotive at GlobalData:
“In August, the global light-vehicle selling rate remained steady at 89.3 million units, consistent with July, indicating a stable overall market. However, due to the strong performance in August 2023, global volume decreased 4% year over year. The year-to-date selling rate through August now stands at 86.6 million units, with volume up only 1% from the same period a year ago.

“With the exception of Brazil and Russia, all major markets experienced a decline in the August selling rate from August 2023. Western Europe stood out with a selling rate increase of 1.3 million units in August from July. Sales in China and North America remain stable but are not indicating a return to the growth rate previously anticipated in the second half of 2024. India (+4%), North America (+4%), and Pan-Europe (+2%) are surpassing the global market pace on a YTD basis. On the other hand, China (-2%), Japan (-9%) and Korea (-9%) offset the gains in the other major markets.

“The selling rate is expected to increase in September and is forecasted to improve to 91 million units. However, volume is still expected to contract 1% from September 2023, which would mark the fourth consecutive monthly year-over-year decline. North America, ASEAN and Western Europe all face challenging year-over-year comparisons, but China and Japan are projected to post gains.

“The 2024 forecast for global light-vehicle sales has been revised down for the fourth time this year, from 89.3 million units at the beginning of the year to 88.5 million units this month, a reduction of 1%. Growth from 2023 has now settled at 2%. The primary factors influencing demand trends remain elevated pricing, geopolitical risks and global economic performance.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

About GlobalData https://www.globaldata.com/

 

Vehicle Alerts Cause Most Complaints About Advanced Driver Assistance Systems, JD Power Finds

2024-09-30

jillian.breska

TROY, Mich.: 3 Oct. 2024 — Advanced Driver Assistance Systems (ADAS) account for 12.8% of total new-vehicle problems with 24.9 problems per 100 vehicles (PP100), according to the JD Power 2024 U.S. ADAS (Advanced Driver Assistance Systems) Quality and Satisfaction Study,^SM released today. Most notably, owners identify vehicle alerts as the top problem area of ADAS issues (9.0 PP100), and such problems have continued to grow during the past five years. A lower score reflects higher vehicle quality.

“The biggest issue consumers have with advanced driver assistance systems is that the alerts are annoying and bothersome,” said Ashley Edgar, senior director of global automotive supplier benchmarking and alternative mobility at JD Power. “As more technology is added to vehicles, manufactures need to ensure that driver assistance systems are integrated in such a way that enhances safety without detracting from the overall driving experience. Additionally, dealer personnel should focus on educating new-vehicle buyers about the purpose of various ADAS technologies to increase comprehension and satisfaction.”

The U.S. ADAS Quality and Satisfaction Study, now in its third year, is based on responses from 99,144 purchasers and lessees of new 2024 model-year vehicles who were surveyed after 90 days of ownership. The study was fielded from July 2023 through May 2024.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

 

Skepticism to Advocacy: Most Consumers Have Positive Experience with Robotaxis, JD Power Finds

2024-10-08

jillian.breska

TROY, Mich.: 8 Oct. 2024 — Climbing into a car with no driver—and expecting that car to take the rider to a predetermined destination—is something about which most consumers are skeptical. However, once someone rides in a robotaxi, they like it. Consumers’ level of satisfaction with the experience is 8.53 (on a 10-point scale), according to the JD Power 2024 U.S. Robotaxi Experience Study,^SM released today. The leading contributor to the positive experience is vehicle technology.

Consumer confidence when riding in a fully automated, self-driving vehicle is 56 percentage points higher among those who have ridden in a robotaxi (76%) than the general population who have not had the experience (20%). Exposure to the technology, as seen by non-riders in cities with robotaxi deployments, also improves consumer confidence (34%). These are indications that experience continues to be a main driver of trust and acceptance.

As an industry leader in measuring consumer readiness for automated vehicle transportation, JD Power gathers valuable, unfiltered feedback from robotaxi riders and those who have interacted with robotaxis (non-riders) in their community. This year, the study expands to five markets—Dallas, Las Vegas, Los Angeles, Phoenix and San Francisco. It also includes brand-level insights for Cruise, May Mobility, Motional, Waymo, and Zoox and includes feedback from a national sample to measure consumer opinions of robotaxi brand imagery and preferences.

“The robotaxi segment is still anyone’s game, given that most people are not familiar with robotaxi brands and haven’t formed a clear associative imagery,” said Kathleen Rizk, senior director of user experience benchmarking and technology at JD Power. “Industry leaders like Cruise and Waymo, along with lesser-known companies such as Zoox, May Mobility and Motional, need to look beyond their deployment markets and find ways to educate and build trust with all consumers.”

When asked to describe their ideal robotaxi service, consumers consistently selected image attributes of safe, reliable and trusted. The consistency with which these metrics are prioritized among riders and non-riders (78% selected safe; 71% selected reliable; and 66% selected trusted), as well as the general population, indicates the foundational expectations of consumers. However, upon examination of brand association with these key metrics, there are notable differences between riders and non-riders in the five markets, as well as compared with the general population. As a result, the reputation of robotaxi brands is somewhat insulated to the testing markets, making it paramount to expand market exposure and brand awareness.

Following are some key findings of the study:

• Consumers seek safety features: When asked what the ideal robotaxi service should offer, the most important items are emergency button to connect with local emergency services; shares location with authorities; ability to select a vehicle that has the safety features they want; and the ability to set the route beforehand.
• Unmet needs drives novelty usage: Currently, consumers are using robotaxis as a novelty, as they do not fulfill the riders’ needs pertaining to the service area coverage and cost of the services. Until robotaxi providers can fulfill these and other needs, the service will remain a novelty transportation method.
• Obeying the law: Attributes in the technology category that score highest among robotaxi riders are vehicle obeys traffic laws (8.36 on a 10-point scale) and the vehicle’s performance maneuvering in normal traffic conditions (8.30).
• Robotaxi vs. rideshare: When given a series of scenarios assuming the cost for either service would be the same, 77% of riders say they would prefer to utilize a robotaxi service without a human driver when needing to have a private conversation in the vehicle, while a ride-hailing service (e.g., Lyft, Uber) is preferred when traveling in an area they don’t know well.

The U.S. Robotaxi Experience Study, now in its second year, is based on responses from 3,773 respondents comprised of 773 consumers living in cities where robotaxi services are available (Dallas, Las Vegas, Los Angeles, Phoenix and San Francisco) and a national sample of 3,000 consumers to better understand their perceptions and knowledge of the technology. To qualify in the targeted cities, respondents had to ride in a robotaxi and/or observe a robotaxi operating in their community. These two groups of participants are classified as riders and non-riders, respectively.

The study is based on five categories (in alphabetical order): comfort and convenience; initiating the ride; riding in the vehicle; service availability and cost; and vehicle technology. The study was fielded in August 2024.

To learn more about the U.S. Robotaxi Experience Study, visit https://www.jdpower.com/business/us-robotaxi-experience-study.

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts 
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info 

 

Excitement of Traditional Auto Manufacturers’ BEV Owners at All-Time High, JD Power Finds

2024-07-23

jillian.breska

TROY, Mich.:  25 July 2024 — Owner satisfaction with new-vehicle design and performance has rebounded after two years of unprecedented decline, according to the JD Power 2024 U.S. Automotive Performance, Execution and Layout (APEAL) Study,SM released today. Overall satisfaction is 847 (on a 1,000-point scale), an increase of 2 points from a year ago. Satisfaction with non-Tesla battery electric vehicles (BEVs) is at an all-time high (877), surpassing stalwart Tesla (870).

“Traditional manufacturers have listened to the Voice of the Customer,” said Frank Hanley, senior director of auto benchmarking at JD Power. “They’re launching enhanced vehicles that are more in line with what customers want, including improved interior storage and higher quality materials, as well as ensuring features have ease of use. For BEVs, recent launches from traditional manufacturers have surpassed perennial leader Tesla when it comes to owners’ level of emotional attachment and excitement with their new vehicle.”

However, one area that continues to put a damper on excitement across all vehicle fuel types is infotainment—one of the 10 factors on which the study is based. Despite satisfaction improving 5 points this year to 823, infotainment remains one of the lowest-scoring categories industry wide. While satisfaction with in-vehicle infotainment systems averages 805, it is higher among owners who use Android Auto (832) or Apple CarPlay (840). This shows that customers prefer to have the simplistic usability of their phone extended into their vehicle more so than what manufacturers are providing.

Now in its 29th year, the APEAL Study complements the JD Power U.S. Initial Quality Study^SM (IQS) and the JD Power U.S. Tech Experience Index (TXI) Study^SM by measuring owners’ emotional attachment and level of excitement with their new vehicle. The APEAL Study asks owners to consider 37 attributes, ranging from the sense of comfort they feel when climbing into the driver’s seat to their exhilaration when they step on the accelerator. Vehicle owners’ responses to queries about these attributes are aggregated to compute an overall APEAL Index score.

Following are key findings of the 2024 study:

• BEVs from traditional manufacturers highly appealing: Across all fuel types, emotional satisfaction is highest among owners of non-Tesla BEVs (877), surpassing Tesla (870), owners of gasoline (842) and plug-in hybrid (841) vehicles. Tesla remains strong for satisfaction among its loyal buyers but is lackluster with conquest buyers. Newer BEVs are achieving higher APEAL scores due to improved battery range and better interior materials.
• Premium brands still stir more emotions than mass market brands: While satisfaction is higher for premium brands than for mass market brands (870 vs. 838, respectively), only mass market brands show year-over-year improvement, on average, rising a single point. The gap was smallest in 2021 when emotional satisfaction among owners of mass market vehicles was only 19 points behind that of premium vehicle owners.
• Infotainment systems are getting more complicated: Gone are the days of only listening to AM or FM radio—owners now switch between a variety of audio sources including satellite radio and Apple CarPlay. However, 25% of owners say switching between sources contributes to a poor audio experience and 23% say difficult menu structure is to blame. “Automakers keep pouring additional features into their vehicle infotainment systems, but it appears to be creating needless complexity,” Hanley said. “Owners struggle to perform simple audio-related tasks, so it begs the question whether automakers are actually in tune with the desires and needs of their customers.”
• High APEAL drives long-term value: Vehicles with a higher APEAL performance retain their value at a greater rate than do those with lower APEAL performance. The Net Promotor Score^®[1] is 38 points higher when APEAL is above average, meaning owners are more likely to promote their vehicle and recommend it to friends and family, further illustrating the long-term effect that a highly appealing vehicle has on the marketplace.

Highest-Ranking Brands

Porsche ranks highest among premium brands with a score of 891. Jaguar (886) ranks second and Land Rover (882) ranks third.

MINI ranks highest among mass market brands with a score of 858. Ram (854) ranks second and Kia (853) ranks third.

Model-Level APEAL Awards

The parent company receiving the most model-level awards (for models ranking highest in their respective segment) is Hyundai Motor Group (seven segment awards), followed by BMW AG (four segment awards and highest-ranking model) and Toyota Motor Corporation (three segment awards).

The complete list of award recipients is:

Hyundai Motor Group: Genesis GV60, Hyundai Santa Fe, Kia Carnival, Kia EV6, Kia EV9, Kia Forte and Kia K5

BMW AG: BMW 2 Series, BMW 7 Series, BMW iX, BMW X4 and MINI Countryman

Toyota Motor Corporation: Lexus LC, Lexus RX and Toyota Tacoma

Stellantis NV: Alfa Romeo Giulia and Jeep Wagoneer

Nissan Motor Co., Ltd: Nissan Titan

Volkswagen AG: Porsche Taycan

Jaguar Land Rover Limited: Land Rover Range Rover

Ford Motor Company: Ford Super Duty

BMW 7 Series is the highest-ranking individual model. Kia K5 receives a model-level award for a fourth consecutive year, while Kia EV6 and Kia Carnival each receive model-level awards for a third consecutive year. BMW iX, BMW X4, Genesis GV60, Kia Forte, MINI Countryman, Nissan Titan, Lexus RX and Land Rover Range Rover each receive model-level awards for a second consecutive year.

The 2024 U.S. APEAL Study is based on responses from 99,144 owners of new 2024 model-year vehicles who were surveyed after 90 days of ownership. The study was fielded from July 2023 through May 2024 based on vehicles registered from April 2023 through February 2024.

For more information about the U.S. APEAL Study, visit https://www.jdpower.com/business/us-automotive-performance-execution-and-layout-apeal-study

About JD Power
JD Power is a global leader in automotive data and analytics, and provides industry intelligence, consumer insights and advisory solutions to the automotive industry and selected non-automotive industries. JD Power leverages its extensive proprietary datasets and software capabilities combined with advanced analytics and artificial intelligence tools to help its clients optimize business performance.

JD Power was founded in 1968 and has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The JD Power auto-shopping tool can be found at JDPower.com.

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]
Shane Smith; East Coast; 424-903-3665; [email protected]

About JD Power and Advertising/Promotional Rules: http://www.jdpower.com/business/about-us/press-release-info

¹Net Promoter System®, Net Promoter Score®, NPS®, and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.

 

July SAAR reaches 16.7 Million—Highest in More Than Three Years

2024-07-25

jillian.breska

The Total Sales Forecast

Total new-vehicle sales for July 2024, including retail and non-retail transactions, are projected to reach 1,340,500, a 2.8% increase from July 2023, according to a joint forecast from JD Power and GlobalData. July 2024 has 25 selling days, the same as July 2023.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 16.7 million units, up 0.7 million units from July 2023 and the highest in more than three years.

The Retail Sales Forecast

New-vehicle retail sales for July 2024 are expected to increase from a year ago. Retail sales of new vehicles are expected to reach 1,135,300, a 5% increase from July 2023.

The Takeaways

Thomas King, president of the data and analytics division at JD Power:
“While the top line sales results are impressive, they are being inflated by sales that would have otherwise occurred in June. The delay occurred because of the software outages in June that limited many dealers’ ability to process transactions, thus affecting the June sales pace.

“The July sales pace would be stronger still were it not for a combination of factors that are affecting consumer demand. While discounts from dealers and OEMs grew in July from June, the increases were slightly smaller than is typical, since July is historically when manufacturers start to elevate discounts on prior model-year vehicles.

“In addition, the industry is also now dealing with the consequences of reduced leasing three years ago. Fewer leases three years ago mean that fewer lessees are returning to dealers to buy or lease a new vehicle today. The volume of leases expiring decreased 7.5% in July from June, following a 14.4% drop in June from May. With fewer lease customers returning to market, there are fewer opportunities for new lease sales.

“After a period of rising new-vehicle inventory on dealer lots—which increases choices for shoppers—there has been a reversion in July. Overall inventory is down 6.7% from the end of June. This is mostly due to the timing of 2025 model-year transition which creates temporary disruptions in vehicle availability. By month’s end, retail inventory is projected to be around 1.6 million units, a decline from recent months, but still a considerable 32.5% increase from July 2023.

The average new-vehicle retail transaction price is declining compared with a year ago due to higher manufacturer incentives, larger retailer discounts and rising availability of lower-priced vehicles increases. Transaction prices are trending towards $44,271—down $1,166 or 2.6%—from July 2023. The combination of slightly higher retail sales and lower transaction prices means that buyers are on track to spend nearly $47.8 billion on new vehicles this month—3% higher than July 2023 and the second highest July on record.

“Total retailer profit per unit—which includes vehicles gross plus finance and insurance income—is expected to be $2,298, down 33% from July 2023. Rising inventory is the primary factor behind the profit decline and fewer vehicles are selling above the manufacturer’s suggested retail price (MSRP). Thus far in July, only 14.5% of new vehicles have been sold above MSRP, which is down from 32.4% in July 2023.”

Total aggregate retailer profit from new-vehicle sales for this month is projected to be $2.5 billion, down 29.2% from July 2023.

“Increased inventory means fewer vehicles are being pre-sold by retailers, with more shoppers able to buy directly off dealer lots. This month, JD Power forecasts that 32.3% of vehicles will sell within 10 days of arriving at the dealership, down from a peak of 58% in March 2022. The average time a new vehicle remains in the dealer’s possession before sale is expected to be 47 days, up from 29 days a year ago.

“Manufacturer discounts are continuing to rise. The average incentive spend per vehicle has grown 52.1% from July 2023 and is currently on track to reach $2,892. Expressed as a percentage of MSRP, incentive spending is currently at 5.9%, an increase of 1.9 percentage points from a year ago. Spending has increased by $197 per unit from June 2024. 

One of the drivers of higher incentive spending from a year ago is the increased availability of lease deals, and leasing is growing accordingly from a year ago. This month, leasing is expected to account for 23.7% of retail sales, up 4 percentage points from 19.8% in July 2023.”

Average monthly finance payments this month are on pace to be $727, up $5 from July 2023. The average interest rate for new-vehicle loans is expected to be 6.90%, flat from a year ago.

So far in July, average used-vehicle retail prices are $28,070, reflecting a decrease of 5.4%– down $1,601—from a year ago. The decline in used-vehicle values is translating to lower trade-in equity for owners, now trending towards $7,809, which is down $1,118 from a year ago.

“This year, the Labor Day holiday weekend will fall within the August sales reporting period. The Labor Day weekend is one of the year’s largest selling weekends and typically falls within the September reporting period. August results this year are likely to be unusually strong and will skew typical year-over-year comparisons. The key question is the extent to which manufacturers and dealers will attempt to leverage elevated shopping activity through aggressive discounts. Historically, the Labor Day weekend has been an excellent opportunity to find a great deal on a prior model-year vehicle.”

Sales & SAAR Comparison

U.S. New Vehicle	July 20241, 2,	June 2024	July 2023
Retail Sales	1,135,301 units (5% higher than July 2023)2	1,016,865 units	1,081,348 units
Total Sales	1,340,513 units (2.8% higher than July 2023)2	1,318,906 units	1,304,617 units
Retail SAAR	13.7 million units	11.9 million units	12.8 million units
Total SAAR	16.7 million units	15.3 million units	16.0 million units

¹ Figures cited for July 2024 are forecasted based on the first 16 selling days of the month.
² July 2024 has 25 selling days, the same as July 2023.

The Details

• The average new-vehicle retail transaction price in July is expected to reach $44,271, down $1,166 from July 2023. The high for any month—$47,329—was set in December 2022.
• Average incentive spending per unit in July is expected to reach $2,892, up $990 from July 2023. Spending as a percentage of the average MSRP is expected to increase to 5.9%, up 1.9 percentage points from July 2023.
• Average incentive spending per unit on trucks/SUVs in July is expected to be $3,016, up $1,069 from a year ago, while the average spending on cars is expected to be $2,391, up $660 from a year ago.
• Retail buyers are on pace to spend $47.8 billion on new vehicles, up $1.4 billion from July 2023.
• Trucks/SUVs are on pace to account for 79.9% of new-vehicle retail sales in July.
• Fleet sales are expected to total 205,212 units in July, down 8.1% from July 2023. Fleet volume is expected to account for 15.3% of total light-vehicle sales, down 1.8 percentage points from a year ago.
• Average interest rates for new-vehicle loans are expected to be 6.90%, down 15 basis points from a year ago.

EV Outlook

Elizabeth Krear, vice president, electric vehicle practice at JD Power:
“EV adoption is growing but at a slower pace. While premium segment retail sales are down 13%—driven by Tesla’s 22% decline—the mass market segment is up 63%. This is primarily due to increasing product availability as the percentage of mainstream shoppers who have viable EV alternatives has jumped to 56% from 38% in January.

“Affordability of premium EVs has been at parity with gas-powered versions for some time, but still generally lags in the mass market segment. That said, significant strides have closed the gap this year—and in high-volume segments. Among compact SUVs, the average transaction price—excluding federal tax incentives—has declined more than $10,000. Five-year total cost of ownership for popular vehicles like Chevrolet Blazer EV and Ford F-150 Lightning is less expensive than comparable gas-powered models.

“As availability and affordability continue improving in the mass market segment, EVs will attract more mainstream shoppers, but growth in charging infrastructure remains a critical part of the equation. Net of analyzing the JD Power EV Index, which tracks monthly consumer interest, product availability, affordability, charging infrastructure and owner satisfaction, the biannually updated JD Power EV retail share forecast for 2024 has been reduced to 9% from 12%. Mass market shoppers need confidence that price parity will stick, and that charging accessibility will continue to improve.”

Global Sales Outlook

Jeff Schuster, vice president of research, automotive at GlobalData:
“The global light-vehicle selling rate reached a milestone in June, hitting 89.7 million units. This marks the highest level of the year and is a significant increase of 2 million units from May. Despite slightly falling below expectations, the industry continues to show resilience and growth. That said, June fell short of June 2023 by nearly 2 million units, as year-over-year comparisons are getting more challenging.

“Sales volume in June declined 1.9% to 7.6 million units from a year ago. However, this figure remains strong and aligns with the volume average expected for the second half of 2024. Several major markets experienced fluctuations in June for various reasons. China’s domestic market saw a decline of 8.0%, the United States had a 4.2% decrease due to the cyberattack and Japan experienced a 4.8% drop due to vehicle shortages. In contrast, Europe managed to grow 6.2%. Eastern Europe grew 17.9% on continued recovery in Russia and strong sales in Turkey. Western Europe gained 2.8% as the rate cut by the central bank has had a positive effect.

“July is looking to post the strongest selling rate of the year, exceeding a 92-million-unit selling rate. Positive year-over-year growth of 3% is projected, with China and Japan returning to neutral volume levels. Europe and North America are each expected to grow more than 3%.

“The global outlook for 2024 has been revised slightly downward again by 200,000 units, with the forecast now standing at 88.7 million units, a 2.2% increase from 2023. Despite the adjustments, 2024 remains on track to be a strong year for auto sales, with anticipated rate cuts and pricing reductions creating a positive atmosphere for consumers.”

Media Relations Contacts
Geno Effler, JD Power; West Coast; 714-621-6224; [email protected]

About JD Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info

About GlobalData https://www.globaldata.com/