February new-vehicle sales numbers are expected to show modest gains when they are released next week, according to Cox Automotive forecasts.
Sales are expected to increase nearly 4% from 2022 and last month, Cox analysts predict.
Not all news is good, however. The sales pace for February 2023 auto sales pace, or seasonally adjusted annual rate (SAAR), will reach 14.4 million, a decline from January’s strong 15.7 million level. The sales pace declines were expected as loan rates and inflation continue to climb.
Vehicle affordability continues to challenge vehicle buyers but is impacting new and used vehicle sales differently as the spring selling season roars in.
“We have diverging markets today,” says Charlie Chesbrough, senior economist at Cox Automotive: “New-vehicle prices remain high while used retail prices are now in decline. New inventory is slowly stabilizing while used supply is falling. However, I wouldn’t be surprised to see this situation change later in the spring. With many affordability-seeking vehicle buyers leaving the new market for the used, dealers may find they have too little used inventory, and price declines may reverse. And OEMs may find they have too much new-vehicle inventory and be forced to be more aggressive with incentives to boost sales.”
The highlights from the Cox Automotive forecast include:
- Light vehicle sales to finish near 1.105 million, a 3.9% rise from last month and a 4% increase from February 2022.
- The SAAR in February 2023 to be 14.4 million, above February 2022’s 13.7 million level but down from January’s 15.7 million pace.
- Fleet sales to show strong year-over-year gains over February 2022’s inventory-limited market.
The data shows mid-size SUV/Crossover sales with the highest market share, selling 190,000 units, down 1.6% from 2022. The greatest decline in market share occurred in among compact car sales where 60,000 vehicles were sold, compared to 70,803 in February 2022, a 15.3% decline.