U.S. Auto Sales Mostly Steady In May As Incentive Spending Drops: Deutsche Bank

Deutsche Bank's recent report indicates U.S. auto sales reached a 15.7 million SAAR in May, slightly below their 15.9 million estimate. The analysts attribute the moderation to a natural correction after April's strong sales and potential seasonal distortions. Ford and Toyota gained market share, with Ford benefiting from its employee pricing strategy. Average transaction prices declined slightly to $46,000 but remain up year-over-year, while incentive spending decreased. Inventory levels remained stable at 46 days' supply, unchanged from April. A prior report highlighted significant uncertainty due to potential tariffs on imported vehicles and parts. Automakers were adjusting strategies, with varied responses like pausing sales, halting operations, or absorbing price increases. The bank estimated substantial cost increases for Ford and GM due to tariffs. While cautious, Deutsche Bank's June update suggests stronger near-term demand than previously feared despite ongoing trade policy uncertainties.