Car & Truck Blog

Transaction Prices on Pace to Set Record for Month of January


For the second consecutive year, the new vehicle retail sales pace in January is expected to fall from year-ago levels, according to a forecast developed jointly by J.D. Power and LMC Automotive. The seasonally adjusted annualized rate (SAAR) for retail sales is expected to be 13.7 million units, down 150,000 from a year ago. Retail sales are projected to reach 893,900 units, a 2.7% decrease on a selling day adjusted basis compared to January 2017. (Note: January 2018 has an extra selling day compared with January 2017).

“Coming off a strong sales period to close out 2017, a slower start to the year was anticipated,” said Thomas King, Senior Vice President of the Data and Analytics Division at J.D. Power. “After the industry’s emphasis on the sell-down of old model-year vehicles in December, January is a transition month as manufacturers shift focus towards 2018 model-year vehicles.”

Through mid-January, 2018 model-year vehicles accounted for 73% of retail sales, an increase of more than 11 percentage points from December. Average transaction prices so far in January have risen to $32,169, the highest level ever for the month of January. This means that while sales will fall on a selling-day adjusted basis, the total value of new vehicles purchased will increase by just over $1 billion from last year’s level.

“The challenge in 2018 will be maintaining incentive discipline, coming off a year when incentive spending per unit reached the highest level ever recorded,” King said. Average incentive spending through the first two weeks of January is $3,733, up $94 from the same period last year and on track to set a record high to start the year.

Read more about J.D. Power's latest transaction news, as well as check out charts and infographics in the J.D. Power newsroom.