Get pleasure from following together with our 2023 and 2024 gross sales tales however not conversant in the lingo? Do not feel unhealthy. Like several enterprise, the auto business loves its jargon, however when you perceive a number of key phrases, you can ignore the press launch fully and analyze the numbers for your self. Able to dig deeper than no matter “segment-best!” claims you’ve got learn in right now’s headlines and get into the nitty-gritty of gross sales knowledge? Nicely, you’ve got come to the precise place. There are only a few phrases it is advisable perceive with a purpose to learn a gross sales chart like a professional. Let’s dive in.
SAAR
We’ll begin right here, as a result of it is the least intuitive and most summary. Many gross sales tales lead with a SAAR quantity. It stands for “Seasonally Adjusted Annualized Rate” and it is merely an estimate of what number of automobiles will likely be offered in any given yr extrapolated from (stat converse for “based on”) the info out there to this point. To acquire this quantity, knowledge magicians look again at a long time of gross sales figures and say, “OK, given the current economic climate and the sales volumes we’ve seen thus far, here’s what we can expect the market to look like by year end.”
And since it is based mostly on cumulative gross sales knowledge, SAAR will get extra correct because the yr goes on and extra figures grow to be out there. The above are full-year gross sales charts from Wards. The left aspect is 2020; the precise is 2021. These charts depict precise gross sales (darkish bars) vs. the SAAR (orange line) as each react to the pandemic. You possibly can see the SAAR modify sharply to the preliminary shutdown early in 2020, however fail to select up on the onset of the provision chain disaster later within the yr. Why? Gross sales usually decline within the winter, so there wasn’t a lot trigger for alarm. Gross sales even ticked up in Q2, and buyer curiosity helped drive SAAR up although constraints have been already strangling inventories. By Might, the SAAR had adjusted to the “new normal.”
So once you see “SAAR,” it means the bean counters are projecting a sure variety of year-end auto gross sales based mostly on present developments. That is it!
Supply
For the needs of reporting, a supply is a sale. Extra precisely, it is the ultimate sale to a buyer. Whether or not that is Tim the Electrician taking his truck house or TimCo the Electrical Contractor receiving a brand new fleet of 60, they’re all deliveries. That is the place gross sales are recorded for the automakers. In some international locations, gross sales are tracked by registrations as a substitute.
YTD/QTD/MTD
Yr to Date/Quarter to Date/Month to Date. These are pretty commonplace monetary phrases which might be used conventionally in automotive reporting. No have to overthink these; they imply precisely what they are saying — they describe the interval in query to this point.
YoY/MoM/QoQ
Yr over Yr/Month over Month/Quarter over Quarter. When figures are described as year-over-year or month-over-month, which means they’re being immediately in comparison with the month prior. Nevertheless, we have seen this language used inconsistently in automotive reporting, so take it with a grain of salt. Just about each automaker stories gross sales relative to the identical interval of the earlier yr (e.g., January 2024 vs. January 2023). Solely not often do automakers discuss with the previous month’s gross sales as some extent of comparability, and after they do, it is normally within the notes, not the gross sales charts.
DSR/Promoting Days
The Day by day Promoting Price and Promoting Days are changes made to uncooked gross sales knowledge to assist present context. Whereas gross sales figures are inherently goal, generally evaluating the identical month from two totally different years is not as correct as it could appear. As a result of quirks of the calendar and the preparations of U.S. weekends and holidays, sellers might not have had their doorways open the identical variety of days once you examine the identical month throughout totally different years. So if there have been 26 promoting days in July of 2022 however 28 of them in July of 2023 (figures made up), all different issues being equal, July, 2023 ought to have been a greater month for gross sales. This info is usually grouped along with different outliers, comparable to large gross sales holidays falling on lengthy weekends that bleed between months, which may wreak havoc on accounting.
Go forth and analyze!
Now you’ve got acquired the instruments to learn an automotive gross sales report like a professional. If there’s something we missed, be at liberty to tell us within the feedback.