Snowstorms expected to chill January auto sales
Winter storms across much of the Central and Eastern United States as well as year-end deals that pulled consumers into dealerships in December are expected to have put a small dent in January auto sales.
As automakers report their first month of U.S. sales for 2016 on Tuesday, analysts expect the industry to be down slightly compared to a year ago to about 1.1 million cars and trucks sold. The estimated decline ranges from less than 1 percent to more than 3 percent compared to January 2015, depending on analyst.
“The snowstorm on the East Coast disrupted an estimated 15,000 sales,” said John Humphrey, senior vice president of the global automotive practice at J.D. Power. “Despite the storm, we’re still seeing a strong month. It’s also important to note that sales weren’t necessarily lost during the storm. We expect to see ... the majority of them recovered in February.”
During “Snow Storm Jonas” from Jan. 22-24, J.D. Power and LMC Automotive reports sales were down 30 percent in the eastern regions, compared with the same period a year ago. In contrast, sales in the western regions increased 5 percent. Despite the heavy snows, the organizations expected an average of 36,499 new vehicles were sold each day in January, totaling sales of just less than 1.1 million vehicles.
Kelley Blue Book, which predicts January sales to hit 1.12 million, expects Fiat Chrysler could lead major manufacturers in year-over-year growth at around 1 percent, thanks to its Jeep SUV and Ram Truck brands.
Overall, analysts are downplaying the expected decline because the sales pace for January still has the industry on track to top 17 million vehicles and January is typically the slowest month of the year for automotive sales.
“When you look at all the circumstances wrapped together, for us to still be hitting 17 million makes me that much more optimistic about the total year sales expectations,” said Kelley Blue Book senior analyst Karl Brauer, adding there were two fewer selling days last month compared to January 2015.
Many industry experts expect new vehicle sales to be higher than the record 17.47 million vehicles sold in 2015.