October US car sales to rebound after government shutdown image

As analysts forecast a sales rise this month, it seems the turmoil created by the government shutdown – and the subsequent impact on consumer confidence hasn’t ultimately impacted car sales.

Kelley Blue Book predicts an 8% increase in auto sales in October compared to the same month last year. Edmunds.com is even more optimistic, forecasting a climb of 12.7% over the same period. A combined analysis by J.D. Power and LMC Automotive also pits an anticipated 8% rise for October.

“Sales in the third week of the month strengthened relative to the first two weeks, which is evidence of vehicle buyers delaying their purchase until the shutdown was resolved,” said Power’s senior automotive analyst John Humphrey.

“It looks like the government shutdown ended just in the nick of time,” said Edmunds.com senior analyst Jessica Caldwell. “The week-by-week data suggests that consumers started to get jittery by the middle of the month. But with the government back to work, most lost sales should be made up in the latter half of the month.”

KBB comments that sales were certainly affected during the first two weeks of the month in the Atlantic coastal region, which has the country’s largest concentration of government employees. Sales there dipped at least 6% during the period, but quickly recovered after the shutdown ended.

Several segments of the market appear to be driving the latest sales upturn, notably crossovers and pickup trucks. It helps that both segments are getting a fresh injection of new product which traditionally brings buyers into showrooms. General Motors, for example, has completely redesigned its Chevrolet Silverado and GMC Sierra pickups for 2014, as has Toyota with its full-size Tundra.