Near record gasoline prices also are making fuel efficiency an issue for motorists thinking about purchasing a new vehicle, according to analysts from Cox Automotive.
This comes as constricted inventories still have overall sales down by double-digit percentages every month in 2022. Cox’s June sales forecast shows the seasonally adjusted annual rate (SAAR) of new-vehicle sales this month is expected to hit 13.8 million, up from last month’s 12.7 million pace but well below last year’s 15.5 million level.
Tesla is the only major brand to increase sales year over year in the first half. Honda, Nissan and VW all see first-half sales drops in excess of 30% year over year. The rise of the EV maker is a trend that is expected to continue for some time.
First-half sales are forecast to be down 17.3% from the same period in 2021, with the second quarter falling 19.3% compared to Q2 2021. There will be a bright spot for one automaker, as GM is expected to outsell Toyota in Q2, regaining the top sales spot in the U.S.
EV sales continuing strong run
Jonathan Smoke, Cox Automotive chief economist, said during a media briefing this week, the consideration of electric vehicles has increased as gas prices have increased. EV sales were up more than 80% in 2021 compared with the previous year and most analysts predict a similar result for 2022, especially as more and more makers roll out new EV offerings, beyond Tesla.
Michelle Krebs, Cox Automotive executive analyst, noted one in four of the visitors to Kelley Blue Book — a widely used shopping site for used vehicles — are looking for information about electrified vehicles. For now, however, a shift to more fuel-efficient vehicles has been hemmed in by the lack of inventory in both the new and used portions of the market, Krebs said.
Cox analysts said tight inventory continues to undercut sales of new vehicles. With no clear timeline for any notable recovery in new-vehicle inventory levels, Cox Automotive lowered its full-year 2022 U.S. auto sales forecast to 14.4 million units, down from its current forecast of 15.3 million.
The current forecast now is for new-vehicle sales volumes to fall below the 14.6 million sold in 2020 when the market was initially ravaged by the global COVID pandemic.
Same problem, different year
The same problem that has plagued the industry for nearly 18 months now will continue to do so through the end of 2022 — at least.
“Last June, I wrote that the concern about the supply situation could not be overstated, as we were in untested territory for the market,” said Charlie Chesbrough, senior economist, Cox Automotive.
“That sentiment remains, as there has been no significant shift in the conditions on the ground since last fall. Even though economic conditions have worsened in the past months, the lack of supply is still the greatest headwind facing the auto industry today.”