Lower Q1 auto sales results belie a hot market

The U.S. industry is not short of buyers right now — just the inventory to satisfy them.

As factory problems on three continents continue to disappoint efforts to capture what analysts say is hot pent-up consumer demand, U.S. auto sales plunged 16 percent in the first quarter for the 11 automakers that reported last week.

“We have a huge incentive on our end to build and ship,” David Christ, head of the Toyota Division at Toyota Motor North America, told Automotive News. “With the consumer demand where it is now, even if we started building cars at full capacity today, it’s going to take us a little while to get through these back orders.”

In announcing its sales results, Toyota thanked its customers “for their patience as we work around the clock to ensure their needs are satisfied.”

Industry totals will not be available until all automakers report. Most companies released U.S. sales results for March and the first quarter on Friday, April 1. Ford Motor Co., Volvo, Daimler, Volkswagen, Audi and Jaguar Land Rover will report results this week or later in month.

Toyota Motor Corp. outsold General Motors in the first quarter by 5,484 vehicles, despite Toyota’s overall sales decline of 15 percent. Toyota replaced GM as the top U.S. automaker last year.

But it is hardly a sluggish market. Many retailers have been selling vehicles on a one-in, one-out basis. Almost as soon as a vehicle reaches a dealer’s lot, a customer shows up to take delivery.

In this market, “our production pace equals our sales pace,” Tyson Jominy, vice president of data and analytics at J.D. Power, told Automotive News.
The pinched sales tally led forecasting firms to revise their sales projections for the full year. LMC Automotive and J.D. Power expect a U.S. light-vehicle sales total of 15.3 million for 2022, down from an earlier forecast of 15.9 million. Cox Automotive also cut its 2022 forecast to 15.3 million from 16 million.