U.S. Light Vehicle Sales Pause in February

Light vehicle sales in February were up by 5.4% over the year to 16.2 million units (seasonally adjusted annualized rate), the slowest rate of increase since April 2014. On a per unit volume level, 1.25 million light vehicles were sold, a 5.4% increase compared with February last year when much of the nation was experiencing similar winter weather conditions.

Total passenger car sales, including foreign and domestic models edged down by 1.6% to 7.0 million units. Sales of foreign models have been on a downward trend since July of last year, partially or completely offsetting increases in sales of domestic models.

• Sales of domestic autos ticked up by 1.4% over the year to 5.2 million units
• Foreign auto sales dropped by 8.9% to 1.9 million units
• Compared with January, total passenger car sales were off by 4.1%, the third consecutive month-to-month decline.

Sales of light trucks, SUVs and crossover utility vehicles continue to be brisk in spite of moderate increases in the price of gasoline in February. Sales were up by 11.5% over the year to 9.1 million units and accounted for 56.6% of the sales mix, the highest since the share of light trucks peaked at 61.1% in July 2005. 

• Sales of domestic trucks increased by 12.1% over the year to 7.7 million units
• Foreign light truck sales, a much smaller segment of the U.S. truck and SUV market, rose by 8.8% over the year to 1.4 million units
• Compared with January, sales of light trucks were down by 0.9%

Sale of medium-heavy trucks, used primarily by businesses to haul freight and make deliveries, posted another large gain last month, rising by 23.4% over the year in February to 453,000 vehicles.

The more moderate pace of sales in February was likely due regional weather effects. If so,  the slowdown should reverse course as the automotive industry moves into the spring selling season. All the fundamentals supporting light vehicle demand (low fuel prices, available credit, expanding employment, and improvements in the construction industry) remain intact. 

Source: Bureau of Economic Analysis