Monthly Auto Sales Data: Read Between the Lines

Watching the sausage being made is never a pretty sight -- in the auto industry, monthly sales numbers are no exception. I should know: I once worked at Mercedes-Benz, where my responsibilities included toting up the data.

For instance, AutoData Corp. reported on May 1 that U.S. light-vehicle sales in April were 1,246,554, down 6.9 percent year-over-year. There's plenty of comment around whether that's bad or good, some of which I wrote (it's bad). But here, I call your attention to the number, "1,246,554." Not 1,246,553, or 1,246,555.

It's absurd to think that anybody knows that precisely, and my friends at AutoData would tell you the same thing. Remember the scene in "I Love Lucy," where Lucy is working on the candy assembly line that keeps getting faster and faster? She can't keep up, and she finally resorts to stuffing the chocolates in her mouth, in her pockets, anywhere before she's completely overwhelmed.

That's what it's like at a car company with sales reports coming in from the dealers. Sure, it's computerized, and digital. But somebody, somewhere in the process has to figuratively cry, "Halt!" and decide to the single digit how many cars the company sold that month.

Having done that, some car companies adjust their sales numbers for "selling days," and some don't. Counting selling days, essentially business days, is a whole other subject. But for the sake of argument, say everybody agrees there were 26 selling days in the month just ended, versus 24 in the year-ago month.

So Toyota Motor Sales U.S.A. Inc. says its sales went down 4.5 percent in April to 217,700 vehicles, even though it sold 210,457 in the year-ago month. Huh? That's because Toyota reports the change by daily selling rate. That is, 217,700 divided by 26, is less than 210,457 divided by 24. But Ford Motor Co., for instance, reports units versus units, with no adjustment for selling days.

As far as I know, nobody adjusts for whether the extra selling days include a weekend, or legal holidays, but that would skew the numbers, too. And some markets allow Sunday sales, and some don't. And don't get me started on year-ago numbers. Car companies often "restate" their numbers in subsequent months, so you very often find that the "year-ago" number in this year's report doesn't match the number they reported a year ago.