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TrueCar’s ALG Forecasts New Auto Sales to Continue Modest Softening Amidst Rising Transaction Prices and Declining Incentives

Average Transaction Prices up over 1K Year-Over-Year

SANTA MONICA, Calif., (May 28, 2019) – TrueCar, Inc.’s (NASDAQ: TRUE) data and analytics subsidiary, ALG, projects total new vehicle sales will reach 1,548,322 units in May, down 2.9% from a year ago. This month’s seasonally adjusted annualized rate (SAAR) for total light vehicle sales is an estimated 16.9 million units for the month. Excluding fleet sales, ALG expects U.S. retail deliveries of new cars and light trucks to be 1,234,218 units, a decrease of 3.4% from a year ago.

“Despite a 50-year low in the unemployment rate and a 15-year high in consumer sentiment, the auto industry continues to face weakening in year-over-year sales,” said Oliver Strauss, Chief Economist for ALG, a subsidiary of TrueCar. “From a historical perspective, however, 16.9 million SAAR is strong, especially considering a declining incentive and rising average transaction price environment.”

  • Automaker average incentive spend has declined for the 9th consecutive month compared to the same period a year ago and will reach $3,359, down 10.1% or $377 dollars year-over-year, and down 1.4% or $47 from April 2019
  • Average transaction price (ATP) continues its ascent, up 3.4% or $1,134 year-over-year
  • Incentives as a percentage of average transaction price are expected to be 9.8%, down 13.1% from a year ago and down 1.6% from April 2019; All automakers are expected to be down except Honda, which will be up slightly ($3) year-over-year
  • Kia and Hyundai are expected to score high amongst mainstream competitors in brand strength this month according to ALG’s Retail Health Index (RHI) driven largely by all-new or redesigned SUVs such as the Kia Telluride, Hyundai Santa Fe and Kona
  • BMW stood out this month in ALG’s brand strength metric as well with high RHI scores amongst luxury brands which we believe is due to the launch of the all-new BMW X7 which hit showrooms last month
  • Used vehicle sales for May are expected to reach 3,402,980, down 1.5% year-over-year yet up 2.3% from April 2019.

“The few brands showing sales growth year-over-year in May are doing so through new or redesigned SUV product,” said Eric Lyman, Chief Analyst for ALG, a subsidiary of TrueCar. “This underscores the importance of automaker timing around lifecycle stage and product strategy that honed in on desirable segments in order to meet the demands of today’s consumers.”

Retail Health Index (Forecast)

RHI measures the changes in retail market share relative to changes in incentive spending and transaction price to gauge whether OEMs are “buying” retail share through increased incentives, or whether share increases are largely demand-driven. An OEM with a positive RHI score is demonstrating a healthy balance of incentive spend relative to market share, either by holding incentive spending flat and increasing share or by increasing incentives with a higher positive increase in retail share.

RHI, Top 12 Manufacturers

May 2019 Forecast YOY Change MOM Change
BMW 0.3% 0.6%
Daimler -1.5% 0.3%
FCA 1.8% 0.0%
Ford 0.0% -0.2%
GM 2.3% -0.3%
Honda 0.4% 0.7%
Hyundai 2.5% 0.3%
Kia 3.5% 1.2%
Nissan 0.0% -0.1%
Subaru 0.6% -0.1%
Toyota 1.8% 0.6%
Volkswagen Group 0.7% 0.1%

RHI, Luxury

May 2019 Forecast YOY Change MOM Change
Acura 2.1% 0.1%
Alfa Romeo -2.5% -0.4%
Audi -3.0% -0.1%
BMW 0.3% 0.7%
Cadillac 0.5% -0.5%
Genesis -6.8% 0.0%
Infiniti -1.9% 0.1%
Jaguar -2.5% 0.0%
Land Rover -1.5% -0.4%
Lexus -0.7% 0.4%
Lincoln 1.9% 1.2%
Maserati -1.7% -1.2%
Mercedes-Benz -1.4% 0.3%
Porsche 0.5% -0.1%
Volvo -0.2% -0.3%

RHI, Mainstream

May 2019 Forecast YOY Change MOM Change
Buick 2.5% 0.3%
Chevrolet 3.1% -0.5%
Chrysler -1.5% -0.5%
Dodge -0.8% 0.4%
Fiat 7.6% 2.8%
Ford -0.1% -0.3%
GMC -0.2% -0.1%
Honda 0.2% 0.8%
Hyundai 2.5% 0.3%
Jeep 0.6% 1.2%
Kia 3.5% 1.2%
Mazda 3.0% 0.3%
MINI 0.5% -0.2%
Mitsubishi 3.1% 1.2%
Nissan 0.2% -0.1%
Ram 4.5% -1.8%
Smart -32.0% -1.0%
Subaru 0.6% -0.1%
Toyota 2.2% 0.6%
Volkswagen 3.0% 0.2%

Total Unit Sales

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YoY % Change YoY % Change (Daily Selling Rate) MoM % Change MoM % Change (Daily Selling Rate)
BMW 32,245 31,031 26,502 3.9% 3.9% 21.7% 21.7%
Daimler 28,457 30,187 25,716 -5.7% -5.7% 10.7% 10.7%
FCA 204,595 214,294 172,900 -4.5% -4.5% 18.3% 18.3%
Ford 222,443 241,527 194,219 -7.9% -7.9% 14.5% 14.5%
GM 258,614 264,895 233,682 -2.4% -2.4% 10.7% 10.7%
Honda 151,279 153,069 125,775 -1.2% -1.2% 20.3% 20.3%
Hyundai 66,253 64,980 55,420 2.0% 2.0% 19.5% 19.5%
Kia 61,481 59,462 51,385 3.4% 3.4% 19.6% 19.6%
Nissan 125,608 131,832 95,698 -4.7% -4.7% 31.3% 31.3%
Subaru 59,846 60,146 57,288 -0.5% -0.5% 4.5% 4.5%
Tesla 10,900 8,557 10,600 27.4% 27.4% 2.8% 2.8%
Toyota 214,858 215,321 183,866 -0.2% -0.2% 16.9% 16.9%
Volkswagen Group 54,879 55,853 51,748 -1.7% -1.7% 6.0% 6.0%
Industry 1,548,322 1,594,715 1,331,671 -2.9% -2.9% 16.3% 16.3%

Retail Unit Sales

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YoY % Change YoY % Change (Daily Selling Rate) MoM % Change MoM % Change (Daily Selling Rate)
BMW 30,015 26,902 24,874 11.6% 11.6% 20.7% 20.7%
Daimler 26,847 26,609 24,333 0.9% 0.9% 10.3% 10.3%
FCA 146,471 163,002 139,444 -10.1% -10.1% 5.0% 5.0%
Ford 147,898 165,412 141,659 -10.6% -10.6% 4.4% 4.4%
GM 201,632 200,178 179,041 0.7% 0.7% 12.6% 12.6%
Honda 148,272 150,373 124,805 -1.4% -1.4% 18.8% 18.8%
Hyundai 52,947 52,141 45,910 1.5% 1.5% 15.3% 15.3%
Kia 47,522 45,153 40,044 5.2% 5.2% 18.7% 18.7%
Nissan 84,926 88,785 68,096 -4.3% -4.3% 24.7% 24.7%
Subaru 55,972 54,228 53,686 3.2% 3.2% 4.3% 4.3%
Tesla 10,900 8,557 10,600 27.4% 27.4% 2.8% 2.8%
Toyota 186,730 192,366 163,020 -2.9% -2.9% 14.5% 14.5%
Volkswagen Group 45,927 50,600 43,868 -9.2% -9.2% 4.7% 4.7%
Industry 1,234,218 1,278,124 1,098,984 -3.4% -3.4% 12.3% 12.3%

Fleet Unit Sales

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YoY % Change YoY % Change (Daily Selling Rate) MoM % Change MoM % Change (Daily Selling Rate)
BMW 2,230 4,129 1,628 -46.0% -46.0% 37.0% 37.0%
Daimler 1,609 3,578 1,383 -55.0% -55.0% 16.4% 16.4%
FCA 58,136 51,292 33,456 13.3% 13.3% 73.8% 73.8%
Ford 74,545 76,115 52,560 -2.1% -2.1% 41.8% 41.8%
GM 56,982 64,717 54,641 -12.0% -12.0% 4.3% 4.3%
Honda 3,007 2,696 970 11.5% 11.5% 210.0% 210.0%
Hyundai 13,307 13,915 11,115 -4.4% -4.4% 19.7% 19.7%
Kia 13,958 14,309 11,341 -2.5% -2.5% 23.1% 23.1%
Nissan 40,682 43,047 27,602 -5.5% -5.5% 47.4% 47.4%
Subaru 3,873 5,918 3,602 -34.6% -34.6% 7.5% 7.5%
Tesla - - - - - - -
Toyota 28,128 22,955 20,846 22.5% 22.5% 34.9% 34.9%
Volkswagen Group 8,951 5,187 7,880 72.6% 72.6% 13.6% 13.6%
Industry 314,116 316,525 232,687 -0.8% -0.8% 35.0% 35.0%

Fleet Penetration

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YoY % Change MoM % Change
BMW 6.9% 13.3% 6.1% -48.0% 12.6%
Daimler 5.7% 11.9% 5.4% -52.3% 5.1%
FCA 28.4% 23.9% 19.3% 18.7% 46.9%
Ford 33.5% 31.5% 27.1% 6.3% 23.8%
GM 22.0% 24.4% 23.4% -9.8% -5.8%
Honda 2.0% 1.8% 0.8% 12.9% 157.7%
Hyundai 20.1% 21.4% 20.1% -6.2% 0.1%
Kia 22.7% 24.1% 22.1% -5.7% 2.9%
Nissan 32.4% 32.7% 28.8% -0.8% 12.3%
Subaru 6.5% 9.8% 6.3% -34.2% 2.9%
Tesla - - - - -
Toyota 13.1% 10.7% 11.3% 22.8% 15.5%
Volkswagen Group 16.3% 9.3% 15.2% 75.6% 7.1%
Industry 20.3% 19.8% 17.5% 2.2% 16.1%

Total Market Share

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual
BMW 2.1% 1.9% 2.0%
Daimler 1.8% 1.9% 1.9%
FCA 13.2% 13.4% 13.0%
Ford 14.4% 15.1% 14.6%
GM 16.7% 16.6% 17.5%
Honda 9.8% 9.6% 9.4%
Hyundai 4.3% 4.1% 4.2%
Kia 4.0% 3.7% 3.9%
Nissan 8.1% 8.3% 7.2%
Subaru 3.9% 3.8% 4.3%
Tesla 0.7% 0.5% 0.8%
Toyota 13.9% 13.5% 13.8%
Volkswagen Group 3.5% 3.5% 3.9%

Retail Market Share

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual
BMW 2.4% 2.1% 2.3%
Daimler 2.2% 2.1% 2.2%
FCA 11.9% 12.8% 12.7%
Ford 12.0% 12.9% 12.9%
GM 16.3% 15.7% 16.3%
Honda 12.0% 11.8% 11.4%
Hyundai 4.3% 4.1% 4.2%
Kia 3.9% 3.5% 3.6%
Nissan 6.9% 6.9% 6.2%
Subaru 4.5% 4.2% 4.9%
Tesla 0.9% 0.7% 1.0%
Toyota 15.1% 15.1% 14.8%
Volkswagen Group 3.7% 4.0% 4.0%

Average Transaction Price (ATP)

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YOY MOM
BMW $56,798 $52,053 $56,302 9.1% 0.9%
Daimler $59,496 $57,993 $60,638 2.6% -1.9%
FCA $36,410 $34,061 $35,689 6.9% 2.0%
Ford $37,725 $36,468 $38,257 3.4% -1.4%
GM $37,640 $36,431 $36,975 3.3% 1.8%
Honda $27,820 $27,645 $28,003 0.6% -0.7%
Hyundai $23,206 $22,235 $23,027 4.4% 0.8%
Kia $23,953 $22,563 $23,902 6.2% 0.2%
Nissan $27,745 $27,657 $27,874 0.3% -0.5%
Subaru $28,897 $27,467 $28,909 5.2% 0.0%
Toyota $32,366 $31,963 $32,399 1.3% -0.1%
Volkswagen Group $37,431 $35,345 $35,688 5.9% 4.9%
Industry $34,137 $33,003 $34,083 3.4% 0.2%

Incentive Spending

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YOY MOM
BMW $5,481 $5,583 $5,571 -1.8% -1.6%
Daimler $5,212 $6,055 $5,168 -13.9% 0.8%
FCA $4,157 $4,465 $4,174 -6.9% -0.4%
Ford $3,867 $4,355 $3,873 -11.2% -0.1%
GM $4,628 $5,330 $4,708 -13.2% -1.7%
Honda $1,886 $1,883 $1,898 0.2% -0.6%
Hyundai $2,562 $2,807 $2,589 -8.7% -1.0%
Kia $3,269 $3,833 $3,273 -14.7% -0.1%
Nissan $3,554 $3,665 $3,612 -3.0% -1.6%
Subaru $1,451 $1,464 $1,461 -0.9% -0.7%
Toyota $2,060 $2,222 $2,061 -7.3% 0.0%
Volkswagen Group $3,516 $3,903 $3,494 -9.9% 0.6%
Industry $3,359 $3,736 $3,406 -10.1% -1.4%

Incentives as % of ATP

Manufacturer May 2019 Forecast May 2018 Actual Apr 2019 Actual YOY MOM
BMW 9.7% 10.7% 9.9% -10.0% -2.5%
Daimler 8.8% 10.4% 8.5% -16.1% 2.8%
FCA 11.4% 13.1% 11.7% -12.9% -2.4%
Ford 10.3% 11.9% 10.1% -14.2% 1.3%
GM 12.3% 14.6% 12.7% -16.0% -3.4%
Honda 6.8% 6.8% 6.8% -0.5% 0.0%
Hyundai 11.0% 12.6% 11.2% -12.6% -1.8%
Kia 13.6% 17.0% 13.7% -19.7% -0.3%
Nissan 12.8% 13.3% 13.0% -3.3% -1.1%
Subaru 5.0% 5.3% 5.1% -5.8% -0.7%
Toyota 6.4% 7.0% 6.4% -8.4% 0.1%
Volkswagen Group 9.4% 11.0% 9.8% -14.9% -4.0%
Industry 9.8% 11.3% 10.0% -13.1% -1.6%

Note: This forecast is based solely on TrueCar’s analysis of industry sales trends and conditions and is not a projection of the company’s operations.

About TrueCar

TrueCar, Inc. (NASDAQ: TRUE) is a digital automotive marketplace that provides comprehensive pricing transparency about what other people paid for their cars and enables consumers to engage with TrueCar Certified Dealers who are committed to providing a superior purchase experience. TrueCar operates its own branded site and its nationwide network of more than 16,000 Certified Dealers also powers car-buying programs for some of the largest U.S. membership and service organizations, including USAA, AARP, American Express, AAA and Sam’s Club. Over half of all new car buyers engage with the TrueCar network during their purchasing process. TrueCar is headquartered in Santa Monica, California, with offices in San Francisco and Austin, Texas. For more information, please visit www.truecar.com, and follow us on Facebook or Twitter. TrueCar media line: +1-844-469-8442 (US toll-free) Email: pressinquiries@truecar.com

About ALG

Founded in 1964 and headquartered in Santa Monica, California, ALG is an industry authority on automotive residual value projections in both the United States and Canada. By analyzing nearly 2,500 vehicle trims each year to assess residual value, ALG provides auto industry and financial services clients with market industry insights, residual value forecasts, consulting and vehicle portfolio management and risk services. ALG is a wholly-owned subsidiary of TrueCar, Inc., a digital automotive marketplace that provides comprehensive pricing transparency about what other people paid for their cars. ALG has been publishing residual values for all cars, trucks and SUVs in the U.S. for over 50 years and in Canada since 1981.