February US auto sales healthy; coronavirus may pressure March sales: consultant

US automotive sales appear to have avoided any significant impact from the coronavirus in February, but March sales may prove the industry's resiliency amid a recent economic slump, Cox Automotive analysts said Wednesday.

"February vehicle sales show the automotive market hasn't caught coronavirus yet," Cox analysts said in a report Wednesday. "However, the real test will be this month, and whether March sales can maintain the same level of activity."

The analysts said the large declines in the stock market over the last week along with the rising uncertainty surrounding the coronavirus "are bound to have some impact on vehicle sales. The key question, which won't be answered for a few weeks yet, is how much."

The automotive consultants said further market reactions and possible US travel restrictions in response to a severe outbreak in the country may pressure automotive buying activity in March.

Cox initially forecast US auto sales to reach 1.3 million units in February, a 6% increase from February 2019 sales. However, the analysts said early estimates indicate that February car sales surpassed the forecast, rising nearly 8% year over year. The consultants did not provide exact figures for the updates to estimated car sales.

The Cox analysts said the seasonally-adjusted annual rate for US car sales finished at a 16.8 million unit rate in February, above its 16.6 million unit expectation.

"Clearly this is a good signal for the vehicle market in that all the concerns surrounding the economy and virus have not kept buyers away," the analysts said.

Cox said fair weather across the country and the extra sales day in February due to leap year likely contributed to the favorable auto sales during the month.

General Motors led all automakers in estimated US sales with 220,000 units, according to Cox data.

In February, GM spokesman David Barnas said the company did not anticipate any impact on its vehicle production for the time being.

"We continue to monitor our supply chain and are in close communications with our tier-one suppliers to attempt to mitigate risks to production in North America," Barnas said.

New vehicle prices also rose in February amid strong sales. Analysts at Kelley Blue Book estimated that the new vehicle transaction price average rose by $975 to $37,876 in February, compared with the price average in February of last year.

"Many of the major manufacturers increased prices by more than 4% by capitalizing on the shift toward SUVs," Kelley Blue Book analyst Tim Fleming said in a Tuesday report. "However, trucks, especially full-size trucks, are exhibiting weakness."