Car Sales Surge in Early April Despite Higher Prices, Reports Edmunds.com
SANTA MONICA, Calif. — April 15, 2011 — Edmunds.com, the premier online resource for automotive information, released today a preliminary analysis of April car sales that points to strong numbers through the first half of the month, even as average prices have increased. The current pace this month suggests that the seasonally adjusted annual rate (SAAR) for car sales in 2011 could rise to 14.1 million new cars sold, but Edmunds.com projects a slowdown in the latter part of the month that will bring the April SAAR closer to the 13.1 million cars projected by Edmunds at the end of March.
"This quickened sales pace will likely settle, as it seems there has been a rush of consumers anticipating a shortage, and most of those sales are likely behind us," said Ray Zhou, PhD, senior analyst at Edmunds.com. "Inventories will soon get leaner, too, as production stoppages in Japan won't allow dealers to restock as quickly, and that may cause some consumers to delay their purchases."
Edmunds.com estimates that the average days to turn — or the number of days that cars sat on dealer lots before they were sold — fell more than 10 percent since the beginning of April, from 58 days to 52. These figures show that consumers are heeding Edmunds.com's advice to consumers to buy now before short supplies and more price hikes hit dealer lots this summer. (See http://www.edmunds.com/about/press/is-the-japanese-earthquake-affecting-new-and-used-car-shoppers-yet.html for details on that recommendation.)
Edmunds.com still projects 12.9 million new car sales in 2011, based on the belief that any supply constraints will only push summer sales to later in the year when automaker production is expected to return to normal. But as the situation in Japan remains fluid and unpredictable, there are several possible scenarios that could further destabilize the market.
"Even a moderate impact on production for Japanese automakers that lasts through most of the summer could lower new car sales to 12.6 million, and a more severe impact could push sales down to as low as 12.2 million," said Edmunds.com Chief Economist Lacey Plache.
Another factor that is likely to affect sales: Edmunds.com found that the rising price of gas is contributing to overall increase in car prices, especially for smaller, more fuel-efficient cars. The average price of compact cars — which, according to Edmunds.com, have seen a boost in sales and purchase consideration as prices at the pump have shot up in the last few months — rose $230. Overall, car prices in the first week of April were $120 higher than in the first week of March.
Edmunds' AutoObserver.com offers in-depth analysis of April sales and the 2011 forecast. The stories may be found at http://www.autoobserver.com/2011/04/uncertainties-in-japan-threaten-us-sales.html and http://www.autoobserver.com/2011/04/prices-rise-on-gas-hikes-strong-april-sales.html.
About Edmunds.com, Inc. (http://www.edmunds.com/help/about/index.html)
Edmunds.com Inc. publishes Web sites that empower, engage and educate automotive consumers, enthusiasts and insiders. Edmunds.com, the premier online resource for automotive information, launched in 1995 as the first automotive information Web site and hosts the most established automotive community online. Its mobile site, accessible from any smartphone at www.edmunds.com, makes car pricing and other research tools available for car shoppers at dealerships and otherwise on the go. InsideLine.com is the most-read automotive enthusiast Web site. Its mobile site, accessible from any smartphone at www.insideline.com, features the wireless Web's highest quality car photos and videos. AutoObserver.com provides insightful automotive industry commentary and analysis. Edmunds.com Inc. is headquartered in Santa Monica, California, and maintains a satellite office in suburban Detroit. Follow Edmunds.com on Twitter@edmunds and fan Edmunds.com on Facebook at http://www.facebook.com/edmunds.