U.S. auto sales appear to have lagged in January, although the slowdown could be temporary.
January is typically a slow month for car sales. But strong consumer confidence, low gas prices and good deals on new vehicles should help sales speed up once the weather warms and buyers get their tax refunds. While sales aren’t expected to top last year’s record of 17.55 million, they’re still expected to come in at historically high levels.
One X-factor is President Donald Trump. Promised tax cuts and infrastructure spending could increase demand for new vehicles. But his threatened taxes on vehicles imported from Mexico could make some new cars more expensive. Mexico imported nearly two million vehicles to the U.S. last year.
“It seems policy will play a bigger role in the market than ever before,” said Jessica Caldwell, an analyst with the car shopping site Edmunds.com.
Sales at General Motors, which sells the most vehicles in the U.S., fell 3.8 percent from last January, while Ford’s sales were down 1 percent. Fiat Chrysler’s sales dropped 11 percent. Nissan’s sales rose 6 percent thanks to strong truck and SUV sales.
Other automakers report sales later Wednesday.
ALG, an automotive forecasting firm, predicts overall sales will be down 1.5 percent from last January to 1.1 million.
January is typically the weakest month of the year for U.S. auto sales, as winter weather and holiday debts keep buyers away from car dealerships. This year, the hangover could be even more acute, since a strong December capped off a record year for the industry.
Consumers are finding some good deals. As auto sales slow after seven straight years of increases, automakers are increasingly desperate to make a deal. Incentive spending averaged an estimated $3,635 per vehicle in January, up 21.6 percent from a year ago, ALG said. Edmunds said 10 percent of all new car loans in January had zero-percent financing.