In six years, the US auto industry went from a recession to an all-time sales record in 2015! The United States auto industry sold more cars and trucks in 2015 than ever before. A total of 17,470,659 vehicles were sold in 2015, an increase of 5.7% compared to 2014 surpassing the previous record of 17.41 million vehicles set in 2000.
“It’s a great time to be in the automobile business.” — Tom Libby, IHS Automotive Analyst
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2015 US Auto Industry Sales Set New Record
What a difference six years can make. The US auto industry set record sales numbers in 2015 as a total of 17,470,659 vehicles were sold, an increase of 5.7% compared to 2014. 2015’s sales numbers surpassed the previous auto sales record of 17.41 million vehicles that was set in 2000. The record breaking sales are due to a variety of factors, and they look to continue into 2016, and even beyond.
First Six-Year Growth Streak Since WWII
The six year growth streak is the auto industry’s first since World War II. The industry remained relatively steady after the previous high in sales in 2000, but dropped dramatically in the later half of 2008 and into 2009 due to a global-scale recession. During the recession, auto sales averaged around 10 million sales per year, but since 2009, U.S. auto sales of new cars and trucks have increased 68%.
What’s Behind this Phenomenal Auto Industry Growth?
The auto industry resurgence can be credited to lower gas prices, attractive incentives, and increased demand that doesn’t appear to be slowing down anytime soon. During the recession, consumers held on to their used cars as a cost-cutting measure. Those cars are now six years older.
Incentives Sweetened as New Car Sales Prices Rose
In 2015, the average new vehicle was priced at $33,188, an increase of 20% since 2005 ($27,655). Increased customer interest in pickup trucks and small-to-midsize crossovers played a big part.
- Sales of the Jeep brand rose 25% Click to Tweet!
- Ford sold more than 780,000 pickup trucks in 2015 Click to Tweet!
- Crossovers Chevrolet Trax and Buick Encore were hot sellers for General Motors
Increased sales price has also increased revenue for auto companies. An estimated $570 billion was made from auto sales in 2015. Click to Tweet!
Average new car sales price is expected to continue climbing in future years; 2008 was the only year since 1995 that the average price didn’t rise was 2008.
Although suggested new car retail price is at an all-time high, gross profit per car sale was down $250 in 2015. WHY? Auto industry incentives are to credit for this decline. Average industry incentives per vehicle rose 3.9% from December 2014 to December 2015, averaging $3,063 of savings for customers.
GMC provided one of the most popular incentives of 2015: zero percent financing on 2015 GMC Sierra 1500 for up to 72 months.
Leasing Vehicles Grew in Popularity
The rise in sales price has spawned a rise in leasing. Edmunds projects that leases will account for a record 29% of new United States auto sales for 2015, an increase of 2% from 2014. 10 years ago, leases accounted for 16.6% of auto sales.
Hyundai presented one of the most popular lease options for 2015, allowing customers to lease the 2015 Genesis for $370 a month over 36 months, requiring no down payment.
Domestic vs. Import: What Americans Preferred
An interesting trend has emerged for auto consumers. Consumers are more likely to purchase an imported car than a domestic brand. However, trucks are the reverse. Truck buyers are more likely to purchase a domestic truck than an imported one.
Cars:
- 12.8% of new car sales were domestic
- 31.5% of new car sales were imports
Trucks:
- 32.5 % of new truck sales were domestic
- 23.2% of new truck sales were imports
Overall, imports beat out domestic vehicles in 2015.
- 45.3% of new auto sales were domestic
- 54.7% of new auto sales were imports
The Big 5 Market Share
General Motors, Ford, Chrysler, Toyota, and Honda accounted for 69% of new auto sales in 2015. As in 2014, General Motors led the way in 2015, closely followed by the other four major brands.
- General Motors accounted for 17.6% of new auto sales in 2015
- Ford accounted for 14.9% of new auto sales in 2015
- Toyota accounted for 14.3% of new auto sales in 2015
- Fiat-Chrysler accounted for 12.6% of new auto sales in 2015
- Honda accounted for 9.1% of new auto sales in 2015
General Motors held the most market share, increasing sales by nearly 6% over 2014. Ford leapt over Toyota to finish with the second highest market share in 2015. Nissan motors gained the most out of all automakers with a 19% sales increase over 2014.
The Year of the SUV
“It was really the year of the SUV.” — Jessica Caldwell, Director of Industry Analysis for Edmunds.com
- Light-duty truck sales totaled 9,729,587, up 13.1% from 2014 Click to Tweet!
- Car sales totaled 7,740,912, down 2.2% from 2014
- Crossover sales totaled 4,551,632 up 18.5% from 2014 Click to Tweet!
- SUV sales totaled 1,706,273 up 10.7% from 2014 Click to Tweet!
Car manufacturers have set their sights on the increased popularity of crossovers and have nearly doubled the number of crossover models in the past decade alone. If the North American International Auto Show is any indication, you can expect to see more crossover SUVs in 2016.
5 Top Sellers of 2015
Three pick-up trucks took the top sales spots for 2015, pacing two fuel efficient, midsize cars. The top 5 autos sold in 2015 were:
- Ford F-Series pick-up truck: Sold 780,354 units
- Chevy Silverado pick-up truck: Sold 600,544 units
- Dodge RAM pick-up truck: Sold 451,116 units
- Toyota Camry: Sold 429,355 units
- Honda Accord: Sold 355,557 units
Ford’s F-Series remained America’s best-selling pickup truck for the 39th consecutive year and the best-selling vehicle for 34 straight years. Toyota Motor Corporation’s midsize Camry was the best-selling car for the 14th consecutive year.
Ford Flexes It’s Muscles
The Ford Mustang has surpassed the Chevrolet Camaro as the best-selling muscle car of 2015.
- Sales for the Ford Mustang jumped 48% from 2014 Click to Tweet!
- 122,349 Ford Mustangs were sold in 2015
This is the first time since 2009 that the Mustang outsold the Camaro, and the success can be attributed to increasing numbers of millennial age buyers. Both Ford and General Motors have been targeting younger buyers with updates to their classic cars such as modern interior features and coupling turbo charged engines with fuel efficiency.
A Close Race in Luxury
Consumers were split on luxury brands for 2015 as BMW paced the luxury field, but only sold approximately 3,000 more luxury units than the third place brand, Mercedes.
- BMW sold 346,023 luxury units in 2015
- Lexus sold 344,601 luxury units in 2015
- Mercedes sold 343,088 luxury units in 2015
All three luxury brands, as well as Audi and Porsche, set annual U.S. sales records in 2015.
5 Factors Boosting Auto Industry Sales
Auto sales are up for a multitude of reasons.
- Lower gas prices
The average U.S. gas price at the end of 2015 dropped to lowest since 2009, creating a strong demand for trucks and SUVs. - Lower interest rates
Many car dealerships are offering low interest rates on their vehicles including 0% financing options. - More demand from public
Many consumers are replacing older vehicles as current vehicles are on average 11 years older. - Looser lending standards
- $3,063 average incentives per vehicle
3 Companies Lost Consumer Trust
While overall sales are up, trust is down for some companies.
- Volkswagen/Audi/Porsche (all manufactured by Volkswagen Group)
- Takata airbags
- TrueCar.com
Volkswagen, Audi, and Porsche were caught in a scandal involving diesel emissions. Software was placed in the vehicles that detected when they were being tested for emissions, changing the vehicle’s performance to improve results allowing for the vehicles to pass the test when they wouldn’t have otherwise.
Takata airbags featured a dangerous flaw for many customers. During an accident, Takata airbags inflated with so much force that they unleashed shrapnel into the vehicle. The airbags turned into one of the most widespread safety recalls in U.S. auto history, covering 23 million airbag inflators across 19 million vehicles produced through 12 car companies. The airbags are linked to 9 deaths and over 100 injuries. All deaths occurred in Honda vehicles.
The website TrueCar.com provided a promising website for car dealers and buyers. TrueCar provided customers with pricing transparency while providing auto dealerships with a cheap and easy way to close sales. In July, the stock plummeted 40% in one day as the company admitted that they were failing to turn web prospects into sales.
A Promising Road Ahead
The increase in auto sales is expected to continue into 2016. Total auto sales for 2016 are projected to range around 17.5–18 million as Americans will look to continue purchasing family friendly vehicles like cross-overs and SUVs. “We expect to see a second consecutive year of record industry sales in 2016,” GM Chief Economist Mustafa Mohatarem said in a statement.
Originally published at www.rawhide.org
