Auto sales dropped sharply in May to 11.8 million units (saar) from 13.1 million units during April. Much of this weakness reflects the shortage in Japanese car parts rather than the depressing effect of the spike in gasoline prices earlier this year.
Fuel-efficient domestic and imported vehicle sales dropped by more than the less efficient domestic light truck sales. The former declined 1.0 million units to 5.8 million, while the later declined 0.3 million units to 6.0 million. Sales of imported vehicles, including cars and light trucks, declined by 0.4 million units to 2.5 million. Thousands of Japanese new autos never made it to the US when they were swept away by the tsunami or couldn’t be manufactured because of the parts supply disruptions in Japan. Auto inventories were already relatively low during April when the days’ supply fell to 40. So sales could have been depressed in May if dealers didn’t have the models that would-be buyers wanted. The buyers might also have been put off from showing up at the showrooms by stories that there was a shortage of certain models and that price discounts were cut back.