According to the monthly sales forecast developed by J.D. Power and Associates' Power Information Network and LMC Automotive, new vehicle retail sales in October continued to show a strong pace from the prior month.
October resulted in a strong double-digit year-over-year growth, projected to come in at 943,200 units, which is a 13 percent increase in volume in comparison to October 2011. The increase in volume represents a seasonally adjusted annualized rate of 12 million units.
"The October retail sales pace is solidifying an accelerating recovery in the automotive market," said Deirdre Borrego, vice president and general manager of U.S. Automotive Operations at J.D. Power and Associates. "Each month, we're seeing stronger signs of a healthy market, not only in terms of sales volumes, but also in dealer inventories, transaction prices and incentive levels."
The predicted selling rate in October is the second consecutive month that unit sales have been above 12 million and the first time it has occurred since April and May of 2008, producing the most accurate measurements the consumer demand through retail transactions.
"It is becoming clear that the U.S. automotive market is finally approaching a stage of a more natural level of demand, which has been accelerated by increasing consumer confidence and a need to replace aging vehicles," said Jeff Schuster, senior vice president of forecasting at LMC Automotive. "This stability at a higher level is taking the edge off the risk factors for the remainder of 2012 and into 2013, as the U.S. economy wrestles with the European crisis. There is further upside potential for 2013 if the level of demand continues to outpace the risk factors post-election."
Total light vehicle sales in October are also projected to increase on a year-over-year comparison, jumping by 11 percent with an expected volume of 1,134,800 units. Fleet sales in October are also expected to represent 17 percent of total sales, slightly below the 5-year average of 19 percent in October.
Despite the recent recalls, auto experts are expecting auto sales to improve on their already impressive performances. Nissan recently recalled the Altima as a result of loose bolts that could increase chances of being involved in a car crash.