U.S. Vehicle Sales (November 2019)

November vehicle sales rebound from October's 6-month low  

• U.S. vehicle sales rose by 2.8% (m/m) or 1.46 million units (seasonally adjusted) in November. On a year-to-date basis, sales have totaled 15.5 million units, slightly lower (-0.9%) when compared to year-ago levels. In seasonally adjusted annualized terms, sales reached 17.1 million, a touch above the consensus forecast of 17.0 million. 
• Sales of both passenger vehicles (+3.2% m/m) and light trucks (+3.4% m/m) were up on the month. Light trucks now account for 74% of total vehicle sales. 
• Of the brands still reporting monthly figures, sales of Kia (12.0% y/y), Honda (11.1% y/y), Hyundai (9.2% y/y) and Toyota (9.1% y/y) were up relative to year-ago levels, while sales at Nissan (-15.9% y/y) were lower.

Key Implications

• After having dropped to a 6-month low in October, vehicle sales bounced back strongly in November, with much of the gains attributed to GM filling the inventory holes that were created as a result of the 40-day long GM/UAW strike that occurred through September/October. If not for the rebound in GM production, some analysts had estimated that November sales could have been reduced by as much as 40k (500k SAAR) units on the month.   
• Our first snapshot into November consumer spending data looks to be a welcome development, particularly following the string of weaker household spending figures seen in recent months. With debt burdens remaining low and households continuing to benefit from healthy wage gains and a strong labor market, we expect this trend to continue through year-end and into 2020.
• With all but one month of 2019 data in hand, it looks like vehicle sales will end the year slightly below the 17-million mark, which will be a first in five years. Looking ahead to 2020, we expect sales to hover in the 16.7-16.9-million range, which is a pace of sales consistent with what's required to meet replacement demand and underlying population growth. 

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