February New-Vehicle Sales to Decline 3%, KBB Says

New-vehicle sales are expected to be down 3% compared to the same time last year, for a total of 1.3 million retail and fleet vehicles sales during February, which lowers the estimated seasonally adjusted annual rate (SAAR) to 17.1 million compared to February 2016’s 17.6 million SAAR, according to Kelley Blue Book.

"Retail growth for manufacturers will be tough to achieve in February, as consumer demand remains relatively flat despite increased incentives," said Tim Fleming, analyst for Kelley Blue Book.  "Regardless of the expected dip in overall volume, at a SAAR of more than 17 million, the sales pace for the industry is healthy, and more importantly, looks to be sustainable as we head into the high volume selling months ahead."

Retail sales in February are expected to account for 73.9% of sales, while fleet sales will account for 26.1%. General Motors, Ford Motor Co., and Toyota Motor Co. are expected to claim the top three spots in terms of sales volume.

Additionally, Subaru of America is poised to realize another record sales month in February thanks to the strength of its crossover utility vehicles like the Outback and Forester, KBB added.

"In addition, the all-new Impreza, which is now on sale, will provide a short-term boost to the automaker, but longer-term prospects for the small car segment remain bleak.  Subaru has aggressive growth targets for 2017, but they currently stand in a great position as the brand with the lowest incentive spending and fastest-selling inventory in the industry,” said Fleming.

Fiat Chrysler, on the other hand, could potentially experience its biggest sales decline in February, according to KBB. The OEM is expected to see sales volume fall across the board.

In terms of vehicle segments, the utility segment is expected to sell the most units in February. Compact SUV/crossovers are expected to sell approximately 223,000 units, 2.2% more than last year, while mid-size SUV/crossovers are expected to sell 166,000 units, 5.2% more year-over-year. Light trucks as a whole, are expected to make up 63% of sales in the month, a 4% year-over-year increase.

Alternatively, compact and mid-size cars are expected to see sales decline by 10.9% and 20.9%, respectively.  

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