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Auto industry finding its footing with Average Transaction Prices up and Incentive spending down versus prior month

Average transaction prices expected to rise 0.9 percent

SANTA MONICA, Calif., (November 1, 2017) - ALG, the industry benchmark for determining the future resale value of a vehicle, projects U.S. revenue from new vehicle sales will reach $45 billion for the month of October, down 0.7 percent from a year ago.

ALG expects a loss of $294 million in revenue for automakers versus October 2016. Additionally, incentive spending is projected to increase 8.4 percent.

"ATP experienced substantial growth in October, fueled by light trucks and a richer mix of new 2018 model year vehicles," said Eric Lyman, ALG's Chief Industry Analyst. "ALG also expects the industry to begin pulling back on incentive spending thanks to much needed production cuts across major automakers."

ALG estimates ATP for a new light vehicle was $33,226 in October, up 0.9 percent from a year ago. Average incentive spending per unit grew by $295 to $3,820 on a year-over-year basis. The ratio of incentive spending to ATP is expected to be 11.5 percent, up from 10.7 percent a year ago.

Average Transaction Price (ATP)

Manufacturer Oct. 2017 Forecast Oct. 2016 Sep. 2017 YOY MOM
BMW (BMW, Mini) $52,912 $50,392 $52,330 5.0% 1.1%
Daimler (Mercedes-Benz, Smart) $62,444 $58,359 $58,697 7.0% 6.4%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat) $33,808 $33,016 $33,335 2.4% 1.4%
Ford (Ford, Lincoln) $35,981 $35,625 $35,514 1.0% 1.3%
GM (Buick, Cadillac, Chevrolet, GMC) $36,865 $36,828 $36,054 0.1% 2.2%
Honda (Acura, Honda) $27,333 $27,116 $27,278 0.8% 0.2%
Hyundai $22,765 $22,607 $22,788 0.7% -0.1%
Kia $21,817 $22,445 $21,839 -2.8% -0.1%
Nissan (Nissan, Infiniti) $27,042 $28,023 $27,448 -3.5% -1.5%
Subaru $28,094 $28,151 $28,122 -0.2% -0.1%
Toyota (Lexus, Scion, Toyota) $31,707 $31,581 $31,010 0.4% 2.2%
Volkswagen (Audi, Porsche, Volkswagen) $36,265 $35,381 $34,633 2.5% 4.7%
Industry $33,226 $32,929 $32,657 0.9% 1.7%

Incentive per Unit Spending

Manufacturer Oct. 2017 Forecast Oct. 2016 Sep. 2017 YOY MOM
BMW (BMW, Mini) $5,028 $6,472 $5,273 -22.3% -4.6%
Daimler (Mercedes-Benz, Smart) $4,882 $4,770 $5,002 2.3% -2.4%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat) $4,631 $4,185 $4,635 10.7% -0.1%
Ford (Ford, Lincoln) $4,443 $4,060 $4,473 9.4% -0.7%
GM (Buick, Cadillac, Chevrolet, GMC) $5,105 $4,456 $5,215 14.6% -2.1%
Honda (Acura, Honda) $2,023 $1,899 $1,958 6.5% 3.3%
Hyundai $2,802 $2,467 $2,843 13.6% -1.4%
Kia $3,915 $3,133 $3,883 25.0% 0.8%
Nissan (Nissan, Infiniti) $4,428 $4,236 $4,471 4.5% -1.0%
Subaru $1,084 $1,097 $1,077 -1.2% 0.6%
Toyota (Lexus, Scion, Toyota) $2,684 $2,429 $2,783 10.5% -3.6%
Volkswagen (Audi, Porsche, Volkswagen) $3,597 $3,855 $3,657 -6.7% -1.7%
Industry $3,820 $3,525 $3,885 8.4% -1.7%

Incentive Spending as a Percentage of ATP

Manufacturer Oct. 2017 Forecast Oct. 2016 Sep. 2017 YOY MOM
BMW (BMW, Mini) 9.5% 12.8% 10.1% -26.0% -5.7%
Daimler (Mercedes-Benz, Smart) 7.8% 8.2% 8.5% -4.4% -8.3%
FCA (Chrysler, Dodge, Jeep, Ram, Fiat) 13.7% 12.7% 13.9% 8.1% -1.5%
Ford (Ford, Lincoln) 12.3% 11.4% 12.6% 8.3% -1.9%
GM (Buick, Cadillac, Chevrolet, GMC) 13.8% 12.1% 14.5% 14.4% -4.3%
Honda (Acura, Honda) 7.4% 7.0% 7.2% 5.6% 3.1%
Hyundai 12.3% 10.9% 12.5% 12.8% -1.3%
Kia 17.9% 14.0% 17.8% 28.6% 0.9%
Nissan (Nissan, Infiniti) 16.4% 15.1% 16.3% 8.3% 0.5%
Subaru 3.9% 3.9% 3.8% -1.0% 0.7%
Toyota (Lexus, Scion, Toyota) 8.5% 7.7% 9.0% 10.0% -5.7%
Volkswagen (Audi, Porsche, Volkswagen) 9.9% 10.9% 10.6% -9.0% -6.1%
Industry 11.5% 10.7% 11.9% 7.4% -3.4%

(Note: This forecast is based solely on ALG's analysis of industry sales trends and conditions and is not a projection of the company's operations.)