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SUV, Truck Profits Offset Auto Sales Slump

cars on a car lot

SUV and truck sales are up, while sales of sedans continue to slide. (WTIU/WFIU News Staff)

Retail auto sales have been trending down for the past three years and auto dealers are feeling the crunch. That’s according to Tyson Jominy, Vice President of Data and Analytics Consulting at J.D. Power and Associates.

He says retail sales in the U.S. are down about 4.1 percent, while total industry sales are down around 2.5 percent.

But, sales are still relatively strong, they just don’t stack up to the growth the industry has experienced for nearly the past decade.

“This would be one of the best years of all time," Jominy says. "I think it would be one of the top 10 selling years, and so we’re coming down from extraordinary highs.”

He says following the great recession, a number of factors worked to make buying a vehicle more affordable, like high trade-in values, low interests rates, aggressive incentives from manufacturers, and increasing loan lengths. Jominy says those advantages have slowed or reversed while prices keep going up.

New vehicles cost on average slightly more than $33,000 this year -- that’s up 4 percent from last year.

Jominy says that price jump is due largely to a shift in the market away from cars to more expensive trucks and SUV’s.

“So almost every year we see a double digit percentage of decline in the sale of sedans," Jominy says.

He says consumer appetite for those more profitable SUV’s and pick-up trucks has helped manufacturers offset the decline in overall sales.

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