Unit sales of motor vehicles rose to 15.8 million in February at a seasonally adjusted annual rate after a negligible downward revision to 14.9 million units in January and also compared to 14.9 million units in February 2023. Sales are slightly higher than the consensus of 15.5 million units in the Econoday survey of forecasters.

The uptick suggests that the strong 16.1 million units sold in December 2023 was somewhat overstated as was the decline to 14.9 million units in January. Some of February's jump may be due to dealers offering incentives and low financing costs and may also be due to tax refunds.

Sales of domestically produced motor vehicles rose to 12.3 million units in February after 11.7 million in January and above 11.8 million units in February 2023. Motor vehicles produced in North America accounted for 78 percent of all units sold; this is a plus for both US production and US consumer expenditures.

Total sales of passenger cars rose to 3.127 million units in February after 2.991 million in January and higher than 2.943 million units in February 2023. Total sales of light trucks which includes minivans, SUVs, and crossovers rose to 12.683 million units in February after 11.929 million in January and 11.933 million units in February 2023. Sales of light trucks continue to account for 80 percent of all vehicles sold. A preference for light trucks with their greater versatility has fixed their share of vehicle sales despite higher operation costs especially for motor fuels.

Heavy truck sales rose to 530,000 in February after 506,000 in January and compared to 503,000 in February 2023. This is the highest pace since 565,000 in May 2023. Despite higher financing costs, it appears that businesses are investing in equipment.

Unit vehicle sales in February are expected to rebound to a 15.5 million annualized rate from January's lower-than-expected 15.0 million rate.

Unit sales of motor vehicles, published by the Bureau of Economic Analysis at the beginning of each month, include domestic sales and imports. Domestics are sales of autos produced in the U.S., Canada, and Mexico. Imports are U.S. sales of vehicles produced elsewhere. The data track all passenger cars and light trucks up to 14,000 pounds gross weight (including minivans and sport utility vehicles). Though totals include a relatively small portion sold to businesses, motor vehicle sales are good indicators of trends in consumer spending and often are considered a leading indicator at business cycle turning points.

Since motor vehicle sales are an important element of consumer spending, market players watch this closely to get a handle on the direction of the economy. The pattern of consumption spending is one of the foremost influences on stock and bond markets. Strong economic growth translates to healthy corporate profits and higher stock prices. The bond market focus is on whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth. This balance was achieved through much of the nineties. For this reason alone, investors in the stock and bond markets enjoyed huge gains during the bull market of the 1990s.

Retail sales growth did slow down in tandem with the equity market during the 2001 recession but then, boosted by a low interest rate environment, rose sharply through 2007 before falling sharply during the Great Recession. Sales then recovered and, once again boosted by low rates, began a long period of steady and favorable growth.

In a more specific sense, auto and truck sales show market conditions for auto makers and the slew of auto-related companies. These figures can influence particular stock prices and provide insight to investment opportunities in this industry. Given that most consumers borrow money to buy cars or trucks, sales also reflect confidence in current and future economic conditions.