U.S. auto sales forecast to plummet in third quarter as chip shortage plagues industry
[ad_1]
Honda Motor Co. vehicles at an AutoNation car dealership in Fremont, California, U.S., on Monday, Feb. 15, 2021. AutoNation Inc. plans to publish earnings figures on February 16.
Getty Images DETROIT – U.S. auto sales are expected to nosedive in September, driving purchases of new vehicles down in the third quarter by at least 13% as the chip shortage continues to disrupt production, new industry estimates show.| Bloomberg | Getty Images
DETROIT – U.S. auto sales are expected to nosedive in September, driving purchases of new vehicles down in the third quarter by at least 13% as the chip shortage continues to disrupt production, new industry estimates show.
Cox Automotive and Edmunds forecasts. J.D. Power/LMC Automotive predict vehicle sales from July through September were less than 3.4 million, down between 13% and 14% from the same time last year when volumes were depressed due to the coronavirus pandemic.
The severe decline, including an expected 24% to 26% fall in September, is due to the ongoing shortage of semiconductor chips for new vehicles.
Automakers have had to shutter their plants infrequently for several weeks or even months due to the parts shortage. Due to low production, and high consumer demand, vehicle inventories fell to records.
“The entire U.S. auto industry — including the Asian manufacturers, which were doing a bit better than their domestic counterparts until recently — is in an incredibly volatile position right now and we are seeing inflated retail prices across the board,” said Jessica Caldwell, executive director of insights at Edmunds.
The year has seen an increase in inventory shortages. Forecasters anticipate that 1 million vehicles will sell in September. Cox Automotive says this would be the lowest number in 10 years.
Since April’s peak of 18.3million, the U.S. sales rate has been falling every month. In September, it is predicted to reach 12.1 million-12.2 million.
Cox analysts predicts vehicle supply will improve mildly in the fourth quarter, and continue to improve throughout 2022, but won’t return to “normal” until 2023 – if ever. Automakers have promised to keep leaner inventories in the future to boost vehicle profits and prices, which have been at record levels.
J.D. Power predicts that September’s average transaction price will surpass $40,000. This is the fourth consecutive month of record-breaking prices.
Thomas King, President of J.D.’s data and analytics division said that the mismatch between high consumer demand and limited inventory leads to higher vehicle prices. Power.
On Friday, the majority of American automakers that sell cars in America are expected to announce their third quarter sales. Ford Motor Sales are expected to be reported on Monday by Ford.
Edmunds expects General Motors and Ford to have the largest third-quarter sales declines of 31.5% and 29.3%, respectively. An outlier for the quarter is anticipated to be Hyundai/Kia, which Edmunds forecasts will be up by 10.1%. Cox Automotive predicts Tesla’s sales will rise by 26% in the third quarter.
[ad_2]