The stock of US carmakers might finally be able to advance faster than usual thanks to the healthy state of the automotive industry and their growing levels of deliveries both at home and abroad.
Investors are closely monitoring the upcoming May sales data for the US, which are forecasted to reach near record marks this year. Having the predictions met would be enough to lift the value of the sector – which is among the cheapest across the US market. That would secure better views on the auto industry, which has been plagued by the memory of the Great Recessions’ disastrous sales and the recent flurry of massive recalls. According to Edmunds.com, a car buying platform, the tally for May could reach total deliveries of 1.6 million new cars and trucks, enough to hit a seasonally adjusted annual selling rate of 17.4 million units. “This is going to be one of the best months ever,” comments David Kudla, chief investment strategist of Mainstay Capital Management in Grand Blanc, Michigan. The analyst also predicts total value of sales to reach almost $40 billion, which is a hair close from the $40.3 billion record in August 2014.
There are numerous factors that contributed to the month’s forecasted stellar results: the lower gas prices that keep demand high for sport utility vehicles, crossovers and pickup trucks; the pent-up demand for new vehicles from consumers that held to their cars as they revived the family’s finances and the timing of the Memorial Day holiday.