Analysts believed that August was going to be the month the auto industry would post its first year-over-year increase for 2017. But then Hurricane Harvey hit Texas, leaving a path of destruction and extensive flooding. Sales for the month would drop 1.9 percent to 1.48 million vehicles when compared to the same month a year ago.
"Harvey will also depress one of the most critical selling periods of the year, spanning the August sales month close and Labor Day weekend. In 2016, these 11 days alone accounted for 4.1% of retail sales, or 580,000 units, nationally,” LMC Automotive said in a report.
But analysts believe sales - new and used - will bounce back in September.
"We expect the recovery in vehicle sales to be quick. People need transportation to get their lives back in order, and in Houston, that transportation is the automobile," said Jonathan Smoke, chief economist for Cox Automotive.
Estimates from Kelly Blue Book puts the amount of vehicles damaged in Harvey between 300,000 to 500,000.
As people get their checks from insurance companies and begin the process of finding a replacement vehicle, automakers are redirecting vehicles to their dealers in Texas. Because of this, Kelly Blue Book has bumped up their sales outlook for the year to top 17 million new vehicles sold.
Whether this pans out or not remains to be seen, especially as Hurricane Irma is projected to hit Florida sometime this weekend.
Source: Detroit Free Press