Car Sales Improving

After a dreary summer, car sales are finally showing some signs of life.  In fact, September is starting to look like the best sales month of the past two years, other than those inflated by "Cash for Clunkers."

"Clearly buyers in late August made some decisions to delay their purchase until potentially a labor day sale, or find some vehicles that weren't around in August,"  said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates.

Schuster expects the Seasonally Adjusted Annual Sales rate for September to run in the 11.8 to 12 million range, a sharp increase from August.  Dealership traffic was particularly strong.

"The real story is a big shift in the retail volume, the volume at dealerships," said Schuster.  "An 8.4 million retail SAAR last month.  We're looking at about as 9.7 this month."

(WWJ AutoBeat Reporter Jeff Gilbert speaks one-on-one with JD Power Analyst Jeff Schuster.)

Total light-vehicle sales for September are expected to come in at 961,500 units, 29 percent higher than September 2009, which was impacted by the expiration of the CARS program. Schuster says Fleet sales in September are tracking at an increase of 8 percent from September 2009, representing a 20 percent share of total sales.

After two months of mixed indicators resulting in downward revisions to the vehicle sales outlook, J.D. Power  is holding its 2010 forecast at 9.2 million units for retail sales and 11.6 million units for total sales.  

Schuster says it's hard to tell whether September is the start of a trend, or whether it was simply boosted by a strong Labor day weekend.

"We're still seeing  mixed signals coming out of the economy.  Generally speaking, things are moving in the right direction, but it's still a long road ahead."