Americans are finally tapping the brakes when it comes to buying new vehicles, according to analysis of first-quarter sales by J.D. Power and Associates.
The firm, which analyzed data from automakers and dealers in the first three months of year, estimates the annual sales rate during the first quarter was 16.7 million vehicles in the U.S.
Depending on the final numbers reported by automakers later this week, the pace of sales during the first quarter could be lowest since the fourth quarter of 2014 when the research firm Autodata calculated a sales rate of 16.69 million vehicles.
“I think we’re starting to see a slowdown,” said Dave Habiger, CEO of J.D. Power. “That said, the consumer remains strong.”
Most executives in the auto industry have predicted 2019 will be the first year since 2014 when annual sales in the U.S. fall below 17 million vehicles. Several factors, including the number of new vehicles sold in recent years, higher interest rates and higher monthly auto loan payments, are all expected to prompt some potential buyers to rethink their plans.
But J.D. Power says the end of “peak auto” doesn’t mean sales and profits will plunge for automakers. In fact, its data shows the shift from less profitable cars to far more expensive SUV’s and pickups. A transition that will help ease the impact of overall sales cooling off.