ALG Expects Automakers to Reach $43 Billion in Revenue in February

Average transaction prices likely to rise 2.3 percent

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Mar 01, 2018, 07:00 ET

SANTA MONICA, Calif., March 1, 2018 /PRNewswire/ -- ALG, the industry benchmark for determining the future resale value of a vehicle, projects U.S. revenue from new vehicle sales will reach $43 billion for the month of February, down 0.5 percent from a year ago.

ALG expects a loss of $218 million in revenue for automakers versus 2017. Additionally, incentive spending is projected to increase 5.3 percent year over year but is expected to decline by 1.9% versus January 2018

"The rising tide of incentive spending is finally turning, with a month over month decline for nearly every automaker," said Eric Lyman, ALG's chief industry analyst. "Increased discipline on incentive spending is a critical component of maintaining a healthy automotive industry and the collective pullback in February indicates continued strength of the new and used retail automotive landscape."

ALG estimates ATP for a new light vehicle was $33,458 in February, up 2.3 percent from a year ago. Average incentive spending per unit grew by $184 to $3,656. The ratio of incentive spending to ATP is expected to be 10.9 percent, up 2.9 percent from a year ago.

Average Transaction Price (ATP)

Manufacturer	Feb. 2018 Forecast	Feb. 2017	Jan. 2018	YOY	MOM
BMW (BMW, Mini)	$51,860	$52,502	$52,260	-1.2%	-0.8%
Daimler (Mercedes-Benz, Smart)	$62,075	$59,088	$61,611	5.1%	0.8%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat)	$34,311	$33,317	$34,335	3.0%	-0.1%
Ford (Ford, Lincoln)	$37,201	$35,649	$37,561	4.4%	-1.0%
GM (Buick, Cadillac, Chevrolet, GMC)	$36,268	$35,964	$36,523	0.8%	-0.7%
Honda (Acura, Honda)	$27,900	$27,391	$28,061	1.9%	-0.6%
Hyundai	$22,856	$23,290	$22,738	-1.9%	0.5%
Kia	$23,141	$22,751	$23,095	1.7%	0.2%
Nissan (Nissan, Infiniti)	$28,019	$27,577	$27,470	1.6%	2.0%
Subaru	$27,822	$27,878	$27,830	-0.2%	0.0%
Toyota (Lexus, Scion, Toyota)	$32,137	$31,410	$31,797	2.3%	1.1%
Volkswagen (Audi, Porsche, Volkswagen)	$34,325	$32,659	$33,810	5.1%	1.5%
Industry	$33,458	$32,707	$33,427	2.3%	0.1%

Incentive per Unit Spending

Manufacturer	Feb. 2018 Forecast	Feb. 2017	Jan. 2018	YOY	MOM
BMW (BMW, Mini)	$5,191	$4,500	$5,318	15.4%	-2.4%
Daimler (Mercedes-Benz, Smart)	$4,872	$4,415	$5,230	10.4%	-6.8%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat)	$4,313	$4,251	$4,334	1.5%	-0.5%
Ford (Ford, Lincoln)	$4,046	$4,093	$4,182	-1.2%	-3.2%
GM (Buick, Cadillac, Chevrolet, GMC)	$4,955	$4,526	$5,193	9.5%	-4.6%
Honda (Acura, Honda)	$1,837	$2,159	$1,762	-14.9%	4.2%
Hyundai	$2,691	$2,172	$2,751	23.9%	-2.2%
Kia	$3,789	$3,383	$3,851	12.0%	-1.6%
Nissan (Nissan, Infiniti)	$4,101	$3,976	$4,104	3.1%	-0.1%
Subaru	$1,356	$896	$1,351	51.3%	0.3%
Toyota (Lexus, Scion, Toyota)	$2,447	$2,154	$2,585	13.6%	-5.3%
Volkswagen (Audi, Porsche, Volkswagen)	$3,589	$3,474	$3,698	3.3%	-3.0%
Industry	$3,656	$3,472	$3,727	5.3%	-1.9%

Incentive Spending as a Percentage of ATP

Manufacturer	Feb. 2018 Forecast	Feb. 2017	Jan. 2018	YOY	MOM
BMW (BMW, Mini)	10.0%	8.6%	10.2%	16.8%	-1.6%
Daimler (Mercedes-Benz, Smart)	7.8%	7.5%	8.5%	5.1%	-7.5%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat)	12.6%	12.8%	12.6%	-1.5%	-0.4%
Ford (Ford, Lincoln)	10.9%	11.5%	11.1%	-5.3%	-2.3%
GM (Buick, Cadillac, Chevrolet, GMC)	13.7%	12.6%	14.2%	8.6%	-3.9%
Honda (Acura, Honda)	6.6%	7.9%	6.3%	-16.5%	4.8%
Hyundai	11.8%	9.3%	12.1%	26.3%	-2.7%
Kia	16.4%	14.9%	16.7%	10.1%	-1.8%
Nissan (Nissan, Infiniti)	14.6%	14.4%	14.9%	1.5%	-2.0%
Subaru	4.9%	3.2%	4.9%	51.6%	0.4%
Toyota (Lexus, Scion, Toyota)	7.6%	6.9%	8.1%	11.1%	-6.3%
Volkswagen (Audi, Porsche, Volkswagen)	10.5%	10.6%	10.9%	-1.7%	-4.4%
Industry	10.9%	10.6%	11.2%	2.9%	-2.0%

(Note: This forecast is based solely on ALG's analysis of industry sales trends and conditions and is not a projection of the company's operations.)

About ALG
Founded in 1964 and headquartered in Santa Monica, California, ALG is an industry authority on automotive residual value projections in both the United States and Canada. By analyzing nearly 2,500 vehicle trims each year to assess residual value, ALG provides auto industry and financial services clients with market industry insights, residual value forecasts, consulting and vehicle portfolio management and risk services. ALG is a wholly-owned subsidiary of TrueCar, Inc., a digital automotive marketplace that provides comprehensive pricing transparency about what other people paid for their cars. ALG has been publishing residual values for all cars, trucks and SUVs in the U.S. for over 50 years and in Canada since 1981.

SOURCE ALG