COX AUTOMOTIVE – New-vehicles sales in December are expected to reach 1.10 million units, a drop of 32% compared to December 2020, according to a forecast released today by Cox Automotive. The December pace of auto sales, or seasonally adjusted annual rate (SAAR), is expected to finish near 11.4 million, down 30% from the 16.3 million sales pace a year ago. December 2021 will be the slowest pace since May 2020, when the country remained mostly closed during the first wave of the COVID pandemic.
New-vehicle sales in 2021 are now expected to finish near 14.9 million, according to Kelley Blue Book vehicle counts, up 2.5% from the 14.5 million in 2020 but well below the five-year average of 17.3 million the industry recorded from 2015-2019, a historic run of robust sales.
“While sales in the first half of 2021 were relatively strong, the industry ran out of vehicles, and sales stalled in the second half,” noted Cox Automotive Senior Economist Charlie Chesbrough. “Total sales in the second-half of 2021 were the slowest in a decade. Demand is healthy, but supply and production disruptions kept the industry in check. You can’t sell what you don’t have.”
Typically, according to Cox Automotive vAuto Available Inventory data, new-vehicle inventory across the U.S. would be close to 3.5 million units, providing shoppers a wide variety of choice and competitive pricing. Since August, however, inventory has been holding steady at approximately 1 million units, limiting choice and driving prices higher. Average transaction prices in November set a record for the eighth consecutive month. Auto sales in the first half totaled 8.35 million units, a strong pace that the left the industry unable to refill the pipeline. Sales in the second half of 2021 will finish closer to 6.59 million.
“Heading into 2022, we believe the supply situation will improve but it will take time to restock the shelves at dealerships,” added Chesbrough. “We expect modest gains in new-vehicle sales in the first quarter, and by the second half of the year a much more robust market should emerge.”
2021 will be the year Toyota Motor Company takes the crown as the best-selling automaker in the U.S. Toyota has successfully managed tight inventory all year. With solid sales for both its Toyota and Lexus brands, Toyota will pass General Motors to become the largest seller of automobiles in the U.S., a historic achievement to say the least. G.M. has annually been the top automaker in the U.S. dating back earlier than any available Cox Automotive data set.
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