U.S. Auto Sales to More Than Double in April - J.D. Power, LMC Automotive

U.S. auto retail sales for April are expected to be the highest ever recorded for the month, helped by strong consumer demand and tighter inventories at dealerships, industry consultants J.D. Power and LMC Automotive said on Wednesday.

Retail sales for new vehicles in April are forecasted to reach 1.3 million units, up 110.6% compared with last year, said the statement. 

Total auto sales for April, including retail and non-retail, are projected to reach 1.5 million units, a 107.1% increase compared to the same period in 2020.

"With the sales pace exceeding the rate at which vehicles are being produced, compounded by significant production disruption due to microchip shortages, there is a growing risk to the industry's ability to sustain the current sales pace in the coming months," said Thomas King, president of the data and analytics division at J.D. Power.

Average transaction prices are expected to rise 6.8% to $37,572, the highest ever for April, while the average incentive spending per unit is expected to fall to $3,191 from $4,953 last year.

King said low inventories "have enabled manufacturers and retailers to reduce discounts", and consumers were willing to buy vehicles closer to the manufacturer's suggested retail price (MSRP) and more expensive vehicles.

The total seasonally adjusted annualized rate for the month will be 18.1 million vehicles, while it was 16.4 million units in 2019, the report said.

Written by:  Stephen Lam, Writer, for Reuters.