CLEVELAND -
It is likely that October’s new-vehicle sales pace will have been little bit stronger than anticipated, according to KeyBanc Capital Markets senior automotive analyst Brett Hoselton. He said the industry remains on track to reach a fourth-quarter seasonally adjusted annualized rate of 12.6 million units.
Judging by the monthly results gathered as of Wednesday, Hoselton said the new-vehicle SAAR was likely close to 12 million units for the month, compared with a pace of 11.7 million units in September and 10.4 million in October 2009.
“The SAAR appears slightly better than expectations, as in recent weeks analysts and automakers were signaling October results that were improving from the previous month and likely approaching 12 million units,” Hoselton indicated.
“Stocks have been strong over the past several weeks driven in part by strong earnings as well as anticipation of an improved SAAR, so we would not be surprised to see a sell the news reaction,” he continued.
New-vehicle sales have been steadily gaining ground, he noted, pointing out that there has been seven straight quarter of sequential new-vehicle SAAR gains (if the third quarter of 2009 — which was inflated by CARS — is taken out of the equation).
The SAAR during the third quarter of 2010 was at 11.6 million, and it is believed that rate increase during the final quarter of the year.
“As a result of this month’s SAAR, we believe that 4Q10 production schedules are likely to remain firm and going forward have increased confidence in our 2011 SAAR and production estimates of 12.6 million and 12.1 million, respectively,” Hoselton shared.