According to Alec Gutierrez, senior market analyst of automotive insights, Kelley Blue Book, October sales will likely miss most analyst estimates because of the effects of Hurricane Sandy. With several major manufacturers already reporting new-vehicle sales results for October, it looks as though sales will hit 14.3-14.4 million seasonally adjusted annual rate (SAAR). Sandy hit the Northeast region, which typically accounts for 25 to 30 percent of all auto sales in the United States, during the last few selling days of the month when sales are typically the strongest. Dealers in the Northeast worked tirelessly to get their new-vehicle inventory to higher ground in the days preceding the storm, limiting sales and hopefully preventing flood damage from the bulk of their inventory. While the storm kept October sales somewhat depressed, the month will close approximately 7 to 8 percent above October 2011.
Small cars remained among the top performers in October as consumers in California and the rest of the nation continue to find ways to cope with high fuel prices. Although the average price for a gallon of gas declined by $0.30 per gallon in October, now at $3.53 per gallon on average, gas prices remain high enough to drive many consumers toward fuel-efficient small cars. The Chevrolet Volt had its best month ever with nearly 3,000 units sold, while the remainder of General Motors’ small-car portfolio saw a 72 percent year-over-year increase. Ford saw nearly 3,200 C-MAX models find a new home in its first full month of sales; an impressive result for the automaker’s all-new hybrid entrant. Overall, Ford’s small-car sales were up 54 percent year-over-year, marking the best performance for the segment in 11 years. With fuel prices quickly retreating, Kelley Blue Book expects sales in the small-car segment to cool a bit in the months ahead.
As Kelley Blue Book looks to November and the balance of the year, the impact of Sandy and the recovery will need to be carefully considered to determine the effect on future auto sales. November sales will likely be reduced by the storm as consumers remain more focused on the recovery than buying a new car. It is too early to tell if sales will continue to be impacted in the next month. December is typically one of the strongest months of the year as dealers and manufacturers pull out all of the stops to liquidate any remaining previous model-year inventory. If dealerships are not fully up and running by that time, sales will be significantly impacted. Kelley Blue Book will continue to monitor Sandy’s recovery to determine exactly what kind of impact we can expect to see moving forward.
