Sales at gas stations were pushed by massive price movements of gasoline; we look at retailer categories separately to sort it out.

By Wolf Richter for WOLF STREET.

Retail sales rose by 0.2% in June from May, seasonally adjusted, but the price of gasoline plunged by nearly 10% in June from May, off the spikes in the prior month, and sales at gasoline stations were pushed down by the lower prices. Gas station sales accounted for 7.5% of total retail sales. In March, April, and May, soaring gasoline prices had pushed up total retail sales. So we look at them separately to see what’s going on. And what’s going on is that consumers have been splurging online and at motor vehicle dealers. Ecommerce hit it out of the ballpark.

Sales at gas stations, which move in near-lockstep with the price of gasoline, plunged by 5.3% in June from May (-48% annualized), seasonally adjusted, according to the Census Bureau today. Over the same period, the CPI for gasoline plunged by 9.7%.

Year-over-year, gas station sales still soared by 21% despite the drop in June, to $65 billion, not seasonally adjusted, as gasoline prices were still up 27% year-over-year. Gas station sales include all the other stuff gas stations sell, and prices of that stuff didn’t fall, which softened the blow. The chart shows gas station sales in billion dollars, red, left scale, and the CPI for gasoline (price level, not percentage change) blue, right scale.

Retail sales without gas stations jumped by 0.72% in June from May (or +9.0% annualized), seasonally adjusted (blue line in the chart below).

Month-to-month growth rates have been in this strong range for the fifth month: +0.89% in May, +0.41% in April, +0.77% in March, and +0.87% in February.

Year-over-year, retail sales without gas station sales jumped by 7.4%, the biggest year-over-year increase since December 2022, to $712 billion, not seasonally adjusted.

The three-month average, which irons out the month-to-month squiggles, rose by 0.67% (red in the chart below). That’s substantial growth. Consumers were splurging.

And it wasn’t inflation. Retailers sell goods, not services. And CPI inflation for “core” goods – which exclude said gasoline and other fuels – was negative (-0.1%) in June from May and up by only 0.8% year-over-year (my analysis of the June CPI inflation data). The core goods CPI roughly applies to retail sales without gas station sales.

YOLO? You live only once. Maybe people are just living life instead of buying overpriced homes and struggling with big down-payments, mortgage payments, homeowners’ insurance premiums, and HOA fees? Home sales fell deeper into the deep-freeze in June, so to speak, despite highest supply in 10 years. Let retailers have some of their money, instead of banks and insurers?

Sales at ecommerce retailers jumped by 1.9% in June from May, seasonally adjusted.

Year-over-year, they soared by 18.0% to $140 billion, not seasonally adjusted, hitting it out of the ballpark, surpassing sales at motor vehicle dealers, and making ecommerce the #1 retailer category in June, with a share of 17.9% of total retail sales.

The three-month average jumped by 1.6% in June from May. This has been going on for months.

The increase in ecommerce sales shows two things: consumers are splurging; and consumers continue to shift more of their purchases to ecommerce from brick-and-mortar stores. The first contributes to retail sales growth; the second is the zero-sum fight for market share.

Ecommerce sales include sales by the ecommerce operations of brick-and-mortar retailers, such as Walmart (one of the largest ecommerce operations in the US), Macy’s, Target, and all the others. Even grocery sales are migrating in more consequential numbers to ecommerce.

Sales at motor vehicle dealers jumped by 2.0% in June from May (+27% annualized), seasonally adjusted.

Year-over-year, sales jumped by 8.5%, to $134 billion, not seasonally adjusted.

The three-month average jumped by 0.94% in June from May.

And it wasn’t inflation. The CPI for used vehicles was negative for June and down by 1.8% year-over-year. The CPI for new vehicles was negative for June and up by only 0.5% year-over-year.

Motor vehicle dealers, which include auto dealers plus dealers of motor cycles, RVs, ATVs, snowmobiles, etc., were the #2 category of retailers in June with a share of 17.2% of total retail sales.

Sales at restaurants and bars inched up by 0.1% in June from May, after two strong months in a row. The three-month average sales jumped by 0.74% in June from May, powered by the prior two months.

Year-over-year, sales rose by 3.8%, to $105 billion.

These food services and drinking places, as they’re called, were the #3 largest retailer category in June with a share of 12.2% of total retail sales.

Sales at food and beverage stores dipped by 0.2% in June from May. Three-month average sales rose by 0.18%.

Year-over-year, sales rose by only 1.0%, to $85 billion, the #4 largest category of retailers, with a share of 11.4% of total retail sales.

The year-over-year increases have been below the rate of CPI inflation for “food at home” (purchased at stores and markets) of 2.6%, which shows the challenges this category of retailers faces:

More grocery sales are migrating from brick-and-mortar stores in this category to “general merchandise stores,” such as Walmart and Costco (see “general merchandise stores” below) and to ecommerce (see above).

In a decades-long trend, food purchases have also wandered off to restaurants. Spending in restaurants began to exceed spending at this category of food retailers in 2019, and the gap has dramatically widened since then as consumers are going for YOLO instead of cooking at home (see “restaurants and bars” above).

Sales at general merchandise stores inched up by 0.06% in June from May. Three-month average sales rose by 0.17%.

Year-over-year, sales rose by 3.2%, to $78 billion, the #5 category of retailer, with a share of 10.5% of total retail sales.

General merchandise stores’ food sales are included here. Walmart, whose brick-and-mortar stores are in this category, is the largest grocer in the US, and its food sales are included here, and not in sales at “food and beverage stores.” But general merchandise stores’ ecommerce operations are included in ecommerce above.

Sales at building materials, garden supply and equipment stores inched up by 0.11% in June from May. Three-month average sales were essentially flat.

Year-over-year, sales rose by 6.9% to $47 billion, the #7 largest category of retailers with a share of 5.5% of total retail sales, behind gas stations.

These retailers have still not fully recovered from the overspending on home improvements during the lockdowns. Those were the good times!

Sales at health and personal care stores fell by 0.81% in June from May. Three-month average sales fell by 0.22%.

Year-over-year, sales rose by 2.0% to $40 billion, making it the #8 largest retailer category.

Sales at clothing and accessory stores fell by 0.31% in June from May, and three-month average sales were flat.

Year-over-year, sales rose by 4.8% to $28 billion, the #9 largest category of retailers.

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