Auto Sales Mixed Across the Country Featured
01 December 2017
Auto sales were mixed but, on balance, steady in the last few months, according to the latest Beige Book from the Federal Reserve. Dealers in upstate New York reported that demand for new vehicles remained fairly robust in October but not quite on par with September's brisk levels. However, scattered increases were reported in used vehicle sales. Vehicle inventories were said to be a bit on the high side but mostly at satisfactory levels. Retail and wholesale credit conditions have remained favorable, according to dealers.Auto dealers in the Philadelphia district reported slight declines overall in year-over-year sales this period, a retreat from the modest increases during the prior period. Dealers were hopeful for stronger sales at year-end, Dealers reported that manufacturers continued to provide incentives for dealers to sustain sales. Growth in auto loan volumes was stronger. Year-to-date new motor vehicle sales through September rose 2 percent in the Cleveland district compared to those of a year ago. That said, auto dealers reported that they are starting to see a slowing in demand after seven consecutive years of gains. Indirect auto lending remained relatively strong.Results were mixed in the Richmond district.A South Carolina auto dealer reported robust growth. However, a Virginia auto dealer reported a drop in sales of high-end vehicles.Recent hurricanes impacted sales in a couple of districts.Auto sales in Dallas were still elevated, but the initial post-hurricane surge had begun to recede.Post Hurricane Irma, Atlanta automobile dealers noted an increase in the momentum of auto sales.Demand for auto finance in Chicago edged down, with contacts noting an uptick in delinquencies in auto loan payments. An auto dealer reported that credit had tightened noticeably for buyers with credit scores at the lower end of the subprime category. Credit card volume increased slightly and quality was unchanged.Multiple auto dealers in the St. Louis district reported a decline in sales, which have failed to meet their expectations during 2017. Memphis and Louisville dealers noted a shift in demand away from used vehicles.Demand for auto loans declined in the district for a second straight quarter, though bankers anticipate that auto lending standards could loosen modestly next quarter.Auto sales continued to fall moderately in the Minneapolis district and were well below year-ago levels. Dealer contacts anticipated a moderate pickup in sales for the months ahead.