JDP: Sales Accelerate on Record-High Q3 Incentives
J.D. Power and LMC Automotive analysts predict that, despite a slow start to 2019 and a short September, third-quarter new-vehicle sales will rebound on the strength of a 6% increase in factory incentive spending.

Moving Labor Day to August on this year’s new-vehicle sales calendar robbed September of a holiday weekend. Analysts project a selling day-adjusted decrease of just 7.8%.
Photo by Capri23auto via Pixabay
COSTA MESA, Calif. — New-vehicle retail sales in September are expected to fall from a year ago, according to a forecast developed jointly by J.D. Power and LMC Automotive. Retail sales are projected to reach 1,007,000 units, a 15.2% decrease compared with September 2018.
However, this year’s Labor Day weekend was credited to August for reporting purposes. Controlling for one fewer weekend, this translates to a year-over-year decline of 7.8%.
New-vehicle retail sales in Q3 are projected to reach 3,622,500, flat compared to Q3 2018. In contrast, new-vehicle retail sales in the first half of the year were down 2.9%. The seasonally adjusted annualized rate for total sales is now expected to be 16.8 million units, down 500,000 units from a year ago.
Read: Used-Vehicle Prices Up 2% From 2018
“After delivering record sales results in August, when retail sales rose 6.2% on a selling day-adjusted basis, the decline in September sales was expected and reflects a quirk in how the industry reports sales,” said Thomas King, senior vice president of the Data and Analytics Division at J.D. Power. “The large decline in sales this month is driven primarily by the timing of the Labor Day holiday. … With close to 250,000 new vehicles sold during the holiday weekend, the exclusion from September reporting is significant.”
King noted that “noise” in the monthly results mean it makes sense to evaluate performance over the entire quarter. Retail sales in Q3 are expected to be flat compared with the same time period last year. This is a “remarkable” improvement from the first half of the year and the first quarter in nearly two years without a year-over-year sales decline, King said.
The decline in September sales was expected and reflects a quirk in how the industry reports sales.
The improvement, however, has been accompanied by record levels of spending. Incentive spending is projected to reach $4,159 (up 6% or $246), the highest level ever for the third quarter and just $28 short of the all-time quarter high set in Q4 2017. The increase is being driven by the ongoing sell-down of old model-year vehicles which account for more than 90% of sales in the quarter and represents the slowest sell-down on record.
Finally, transaction prices are expected to set another record for the quarter, with the average new-vehicle sales price projected to reach $33,321, up $1,229 (4%) from last year. The average price for cars is up 4% to $26,736; light trucks and SUVs are up 3% to $35,725.
Originally posted on Auto Dealer Today
More Industry

Pennsylvania Dealership Under New Retailers
The sale of the Chrysler Dodge Jeep Ram store puts a family auto group on a leaner path as first-time dealers take the helm.
Read More →
Battery Storage Takes Priority Over EVs
U.S. automakers are prioritizing battery energy stationary storage over electric-vehicle production as the consumer demand for EVs lags the rest of the world.
Read More →
Auto Dealers Feel Better But Not Great
A second-quarter Cox Automotive poll of franchised retailers and independents found better views of the current market after a good spring but anticipation of third-quarter storminess.
Read More →
New-Vehicle Sales Picture Relative
A May forecast is complicated by last spring’s trade tariff effects on auto retail. Despite continued hard realities, many consumers took advantage of ways to bite the bullet.
Read More →
Auto Group Acquires Third Nissan Rooftop
Iowa-based Coleman Automotive Group recently acquired its seventh dealership, McGrath Nissan, which it renamed Nissan of Elgin.
Read More →
April Less Affordable
Based on prices, reduced incentives and slower household income growth, consumers found it more challenging to buy new last month, Cox Automotive reported.
Read More →
Building an Extraordinary F&I Agency
Work to determine your specialized talent, because that fact will determine everything about your agency’s future.
Read More →
Recipe for Compliance
The secret to both amazing barbecue and compliance is the same: understanding the basics and committing to a process.
Read More →
EVs Getting More Attractive
A growing percentage of U.S. consumers are open to switching and fewer are adverse to the idea, according to a recently completed survey. That’s despite the end of a tax break.
Read More →
EV Sales Drop in April Following Surge
North American electric-vehicle sales were down 28% year-over-year, a sharp contrast from global EV sales growth of 6%.
Read More →