Forecasters Believe July 2017 Was the U.S. Auto Industry's Seventh Consecutive Month of Decline

Timothy Cain
by Timothy Cain
forecasters believe july 2017 was the u s auto industry s seventh consecutive month

Despite all of the attention being called to the U.S. auto industry’s downturn in early 2017, first-half auto sales slipped only 2 percent from 2016’s all-time record highs.

But the rate of decline in July 2017 is expected to be the worst of the year so far, with forecasters generally calling for drops of at least 5 percent.

That will represent a loss of at least 76,000 sales in July alone.

Year-over-year, January volume only fell 2 percent below January 2016’s pace. February sales were down just 1 percent. March sales slid less than 2 percent, ending a first-quarter in which U.S. auto sales declined 1.5 percent, or approximately 60,000 sales.

April’s near-5-percent dive suggested a sharper downturn yet to come, but then May volume was only slightly south of flat. June sales were down 3 percent. Through the end of the first-half of 2017, U.S. auto sales were off 2016’s pace by roughly 185,000 units.

A forecast from J.D. Power and LMC Automotive suggests the overall 5-percent sales decline expected in July 2017 is only part of the picture. Within that overall image is an equivalent drop in retail sales and an 8-percent year-over-year increase in the average incentive spend (to $3,876). Loan terms in excess of seven years likely formed more than 6 percent of all finance arrangements for the first time ever. The typical new vehicle sold in July had already sat on a dealer lot for 72 days.

Meanwhile, Kelley Blue Book believes U.S. auto sales tumbled slightly further in July 2017, suffering a 6-percent drop to 1.43 million sales. With the downturn cementing, KBB now believes year end auto sales may well fall below the 17-million mark topped in 2015 and 2016 after 13 years of sub-17-million years.

Edmunds paints an even less rosy picture, expecting a drop in U.S. auto sales of slightly more than 6 percent in July. Edmunds forecasts an 11-percent sales decline at General Motors, America’s top-selling auto manufacturer, a 7-percent decrease at Fiat Chrysler Automobiles, and a 5-percent Ford Motor Company decline. American Honda is expected to report a 4-percent improvement.

Subaru, as we’ve come to expect, is forecast to report its 68th consecutive month of year-over-year U.S. sales growth, seemingly unaffected by waning industry-wide demand.

Automakers will issue their U.S. July 2017 auto sales reports on Tuesday, August 1st.

[Image: Subaru]

Timothy Cain is a contributing analyst at The Truth About Cars and and the founder and former editor of Follow on Twitter @timcaincars.

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  • DenverMike DenverMike on Jul 28, 2017

    What's a brand new car/truck got (that I just gotta have!), that one just coming off a lease won't 99% satisfy? It's not that the new stuff is too expensive, it's not, but if I got a tired 2009, why not ditch it for a cleaner, much lower miles 2012 that some sucker religiously maintained, for a net outlay less than the "down payment" on a new one??

    • See 5 previous
    • DenverMike DenverMike on Jul 29, 2017

      @DeadWeight Yes you might wanna check your oil level, now and again. It's in the Owner's Manual. Eventually you add enough oil to equal an "oil change". So you can't say it's the same oil for 50,000 miles anyway.

  • Pig_Iron Pig_Iron on Jul 31, 2017

    That's what you get in an unsustainable economy.

  • Bkojote I think it's a home run that VW is bound to bungle.For the anti-CUV crowd there's a cool factor here as pickup trucks have become so cartoonish. This will absolutely embarrass the neighbor with a GMC pavement princess pile in the driveway. Even better, the VW van fandom hasn't ruined these the same way it has the Sprinter, and honestly the design looks tight. And believe it or not there's huge demands for minivans- look no further than the unobtanium that is the Toyota Sienna.So here's what's going to go wrong-These are going to be priced on the premium end and they'll be hype for the first 3 years. The owners (whom The MKIV coil packs and dieselgate disasters a distant memory) trading in their post-college Rav4's and CR-V's are going to quickly discover the whole host of Volkswagen failures- bad sensors, glitchy software, leaking roofs, and hell it'll probably have an emissions scandal of its own somehow. This on top of the already terrible haptic controls VW has, the unreliable charging network, and terrible range. And they'll have the privilege of endlessly fighting with Sleazy Sam's VW dealership after the 4th flat bed tow.They're gonna make the same mistake the kids did in the 80's with the rabbit, the 90's with the Passat and Jetta, and the 00-10's with the TDI's- think VW finally turned the corner and stopped making garbage before doing the trade of shame back to Toyota and Honda.
  • Buickman the only fire should be in the board room.they just hired an executive from Whirlpool.that should help them go do the drain.
  • Mike Beranek I don't care about the vehicles. But I'd be on board for inspecting the drivers.
  • Art Vandelay Coming to a rental lot near you. And when it does know there is a good chance EBFlex and Tassos have puffed each other's peters in it!
  • Art Vandelay I doubt there is even room for EBFlex and Tassos to puff each other's peters in that POS