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Brutal Winter Bogged Down Car Sales But Spring Brings Hope

The harsh winter of 2013-2014 took a toll on car sales, but analysts are hopeful that spring will bring a boom in sales.

This winter, the Northeast was reminded what it feels like to have below-freezing temperatures for an extended period of time, with many cities enduring one of the coldest winters in 20 years. The South dealt with immobilizing rounds of snow and ice. Repeated snowstorms pummeled the Midwest, causing seasonal snowfall records to fall for some major cities.

There is no direct correlation between wintry weather and car sales but statistics show a relationship between the two. Analysts said that both the fleet side and the retail side of the business have seen significant decreases over the past few months but are hopeful for the spring season ahead.

Kelley Blue Book Senior Analyst Karl Brauer said there should be an increase of sales once the temperatures start to increase. The crawl out of slower winter sales will come as much-needed relief.

"The cold weather had an undeniable impact on car sales at the start of the year. A rebound in sales for the Midwest and Northeast regions is occurring right now, and should counter the polar vortex that chilled sales during January and February," Brauer said.

Even March had unusually cold weather, taking a toll on what would have been a month for increased sales.

"Last month, we definitely saw an effect from the weather, especially in the Northeast. Come the end of March, we predict a return to normal," Carly Schaffner of Toyota Media Relations said.

March kicked off the spring selling season and Toyota is looking forward to putting the winter of delayed purchases and slow sales behind them.

Toyota released a statement on March 3, 2014, citing that recent economic reports indicate the unusually harsh winter and how it continues to have an effect on the economy, in general. The weather certainly had an impact on auto sales in February.

Ford Sales Analyst Erich Merkle said that as far back as January, logistics show that weather delayed the making and shipping of model parts to different ends of the U.S.

"In January, on our fleet side, we were about 4,000-5,000 production parts behind and we had to make up for that in February and then in March. But March sales are much better and this comes as welcomed news," Merkle said.

Ford isn't the only company who had complaints about this winter affecting both the fleet side and the retail side of the business.

"Across the board, weather hasn't been kind to fleet or retail for that matter. People in areas like the Northeast, Great Lakes, even in Georgia and Florida, with adverse weather didn't want to go car shopping on a 12-degree day," Brauer said.

Brauer compiled a list that shows the shift in sales during the cold-weather months as well as the regional share of new car registrations in the second quarter of the year (April-June) when there is a general warmup.

"It looks like the most affected region was the Mideast (Washington, D.C., Delaware, Maryland, New Jersey, New York, Pennsylvania), where there was a drop in market share of between 3 to 3.5 percent for two weeks in early February. It looks like the same exact thing happened one year earlier, just showing the impact of severe storms. Hurricane Sandy is responsible for the big drop in 2012," Brauer said.

The vertical bar represents the Mideast region percent of retail sales, while the horizontal accounts for the week of the year. In 2014, there is a significant dip between weeks seven to nine where the Mideast had a big snowstorm right around Valentine's Day.

Here's a look at spring new car registrations from 2012, showing that people are in the buying mood once it thaws out:

Region
Percent of Calendar Sales in Quarter Two (April-June)
New England
27.8%
Rocky Mountain
27.8%
Great Lakes
27.2%
Mideast
27.0%
Far West
26.8%
Plains
26.5%
Southwest
26.0%
Southeast
25.9%

"Retail won't be nearly as hampered during the spring because it's not as hard to get out and shop for a car," Merkle said. "Customers don't have to worry about the cold, snow or power-outs."

While a chill is expected to linger into April for portions of the Midwest, Ohio Valley and far interior Northeast, it will warm up quicker for the balance of the South and East, according to the AccuWeather long-range forecasting team.

"Annually, we see that there is a weather element that generally slows sales in the beginning of the year, but when the weather turns we'll see a serious kick-up when it becomes more favorable outside," Brauer said.