DEMAND for higher-priced vehicles from retail buyers at the end of 2020 helped lift U.S. auto sales out of a springtime slump and buffered the impact of a sharp drop in fleet sales to rental-car companies. Automakers likely sold about 15.9 million new vehicles on a seasonally adjusted annualized rate basis in December, down 4.7 percent from a year ago, according to an average of five market researcher forecasts. Unexpectedly strong retail sales in the third and fourth quarters are likely to have bolstered the market despite an uncertain economic outlook and the lingering pandemic. Buyers are trading up for more expensive rides. Sport utility vehicles and pickup trucks are on track to make up 79 percent of total sales in 2020, up from 75 percent a year ago, estimated J.D. Power and LMC Automotive in a joint forecast. Sedans accounted for more than half the U.S. market in 2010, but now are projected to drop to just one of every five new vehicle sales. The resilience of the U.S. auto market — which saw annualized sales plunge to more than 40-year lows in April as automakers temporarily closed factories and showrooms — has buoyed profits at automakers and kept dealer inventories tight. “Strong retail sales, combined with record transaction prices and low manufacturer discounts, is good news for manufacturer profitability,” Thomas King, J.D. Power’s head of analytics and data, said in a statement. (SD-Agencies) |