New vehicle sales rose by 3.0% y/y in June, after recording growth of 2.4% y/y in May, exceeding industry expectations, according to NAAMSA
NAAMSA further commented that “(o)ut of the total reported Industry sales of 46 678 vehicles, an estimated 38 498 units or 82,5% represented dealer sales”.
Looking at a disaggregation of the data, the passenger car segment grew by 4.4% y/y in June, after logging a small rise in May of 0.6% y/y.
Growth in the commercial vehicle category slowed to 0.5% y/y in June, from 5.3% y/y in May, supported by the heavy vehicle segment*, which rose by 10.1% y/y.
Export sales plunged 15.2% y/y in June, after rising by 13.8% y/y in May.
According to NAAMSA “(t)he industry’s export performance was likely to be affected by current protectionist policies in the United States which had increased the risk of a global trade war and this could impact on international trade flows, including vehicle exports”.
We do project a small rebound in economic growth this year, to 1.4% y/y, from 1.3% y/y in 2017, which should drive modest demand going forward. However imported cost pressures, coupled with rising fuel costs and other consumer taxes could impede any notable lift in new vehicle growth this year.
The opinions and views expressed are for information purposes only and are subject to change without notice. They should not be viewed as independent research, recommendations or investment advice of any nature.