Automakers bolster revenue in February, TrueCar finds

(March 4, 2015) SANTA MONICA, Calif. — TrueCar finds that amid the best auto industry and economic fundamentals in a decade, higher new vehicle sales and transaction prices in February generated $41.8 billion of revenue for automakers, an 11.6 percent jump over a year ago.

TrueCar estimates sales of new cars and light trucks expanded 8.5 percent last month, reaching the best February volume since 2002. The average transaction price (ATP) for light vehicles was $32,245, up 2.8 percent over a year ago, while average incentive spending per unit decreased by $79 to $2,623. The ratio of incentive spending to ATP was 8.1 percent, contracting from 8.6 percent versus the prior year.

“February yielded attractive net revenue gains for auto manufacturers during this second consecutive month of double-digit growth,” said Eric Lyman, vice president of industry insights for TrueCar.

“With West Coast port labor disputes resolved, strong new vehicle sales and industry incentive spending to average transaction prices at reasonable levels, the health of the industry and automotive outlook for 2015 remain remarkably bright.”

Robust automotive sector performance coupled with personal savings growth and a slight increase in inflation-adjusted consumer spending signal a strong footing for the U.S. economy, Lyman said.

TrueCar estimates the average incentive for light vehicles in February decreased $79, or 2.9 percent, from a year ago, while increasing $36, or 1.4 percent, from January 2015.

Last month’s ratio of incentive to ATP for light vehicles was 8.1 percent, down 5.6 percent from February 2014 and up 2.4 percent from January 2015, based on TrueCar analysis. GM, Subaru and Ford showed the most improvement in ATP ratio in February versus the year-earlier month.