Americans bought slightly fewer new vehicles in 2019 but spending on new autos passed $460 billion for the first time, driven by rising transaction prices.
Research firm J.D. Power/LMC Automotive said it expected total 2019 sales to decline 1.4% to 17.2 million vehicles compared with the previous year and spending to increase 1.8% to $461.7 million, reflecting an average transaction price of $33,656, up 3.6% from 2018.
The sales figure was the lowest since 16.5 million vehicles in 2014 but 2019 was the fifth straight year that sales topped 17 million. Retail sales dropped 1.7% to 13.7 million, J.D. Power said, but that was still the 10th-best retail sales year in history.
“Despite a lot of noise and some uncertainty with light-vehicle sales, 2019 has turned out to be a strong year,” Jeff Schuster, president of Global Vehicle Forecasts for LMC Automotive, said in a news release.
“Much of that uncertainty has dissipated with [the new trade agreement between the U.S., Mexico and Canada] nearly across the finish line, the progress with the China trade deal and an economy that is expected to be supportive,” he added.
Another research firm, Cox Automotive, has forecast total 2019 new vehicle sales of 17.09 million, down 1.3%, while Edmunds predicted sales would fall 0.7% to 17.1 million.
Experts are not predicting an industry downturn next year comparable to 2009 when vehicle sales dropped below 11 million. But Cox cited record non-housing debt, slowing retail spending in the fourth quarter of 2018, and rising severe delinquencies and defaults as potential concerns.
“Collectively these trends suggest that the consumer may not be capable of singlehandedly carrying the economy in 2020, which is why we are expecting another decline in new-vehicle sales,” Jonathan Smoke, chief economist at Cox, said.
J.D. Power/LMC Automotive expect U.S. auto sales of 16.8 million this year while Cox and Edmunds are forecasting 16.7 million and 17.1 million, respectively.