Auto Sales

Posted in Finance, Accounting and Economics Terms, Total Reads: 435

Definition: Auto Sales

Auto Sales plainly defines the number of domestic automobiles sold. The major participants in the automobile industry have to report their auto sales on a monthly basis to the Department of Commerce. The Department of Commerce then adjusts these figures accordingly (depending upon certain factors like seasonality) and presents these figures to the public in the first five business days of the month.

Automobiles form a major part of the manufacturing sector of the country and thus auto sales reports have a critical impact on the financial markets. Another reason being, that auto sales reports provide very meaningful information about the consumer demand of the sector.

Auto sales have a huge effect on the economy as they are extremely sensitive to any kind of changes in the economy. Thus they also form a component of the overall retail sales report as they are volatile and can change the figures of the report disproportionately.

Thus it is really important for the stock market to evaluate the auto sales reports at a frequent basis so that the volatility of the market can be judged fairly and the market rates can be set accordingly. This would also affect interest rates, thus causing a change in the overall economy. If the auto sales figures are high, then the economy would be in a better position, as it would generate more revenue and increase employment. The major other industries affected by the automobile industry would be the hotel industry, steel and rubber industry and so on.



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