As month ends sales continue to show weakness

(May 31, 2011) WESTLAKE VILLAGE, Calif. -- The return of some incentive programs has not been enough to drive more consumers into showrooms, as May new-vehicle retail sales continue to exhibit weakness through the third week of the month, according to J.D. Power and Associates, which gathers real-time transaction data from more than 8,900 retail franchisees throughout the United States.

The retail selling rate in May is expected to come in below 9.5 million units for the first time since August 2010, while the seasonally adjusted annualized rate (SAAR) for total light-vehicle sales is expected to be below 12 million units.

"As lower incentive levels, high gas prices and inventory shortages plague the month-to-date sales rate, light-vehicle sales in May have been unable to shake the slowdown from the stronger pace of the first four months of 2011," said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates.

"May's overall performance will hinge on how strong Memorial Day weekend sales were, but heading into this past weekend, the selling pace was indicating a SAAR closer to 11.5 million units."