Automakers immediately report 2nd quarter automobile gross sales. That is what buyers ought to count on
A Totota dealer is seen in Annapolis, Maryland on May 27, 2021 as many car dealerships across the country are running low on new cars as a shortage of computer chips has caused production to near-halt at many vehicle manufacturers.
Jim Watson | AFP | Getty Images
DETROIT – New vehicle sales in the US remain healthy but are showing signs of slowing amid inflation concerns and a global semiconductor chip shortage that continues to depress auto production and dealer inventory levels.
Analysts estimate automakers sold about 4.5 million vehicles in the U.S. in the second quarter – a 52% to 53% year-over-year increase when the coronavirus pandemic caused Americans to seek shelter and auto dealers to temporarily shut down shut down. Most major automakers are reporting June and second quarter sales data on Thursday, with the exception of Ford, which is expected to release its results on Friday.
While the sales rebound from the depths of the coronavirus pandemic is impressive, the pace of sales is slowing this year. Deutsche Bank analyst Emmanuel Rosner expects sales of 15.7 million vehicles in June, compared to 17.1 million vehicles in May and 18.6 million vehicles in April.
Sales pace for a given month measures how many cars the industry would sell for the year if it sold the same amount every month. It’s a key barometer of health and consumer demand for the industry.
“The drop in sales is likely to reflect a lack of availability from dealerships rather than a decrease in consumer demand as automakers struggle to replenish dealer inventories with top of the line models, particularly SUVs and pickups,” Rosner wrote in an investor note ahead of the June and June sales data release second quarter from Thursday.
According to auto research firms Cox Automotive and Edmunds, sales of all major automakers are expected to grow double-digit in the second quarter compared to the same period last year. However, they are only slightly above the second quarter of 2019.
Something that shows no signs of slowing is new vehicle sales prices due to the scarcity of supply due to global chip shortages and stronger than expected consumer demand during the coronavirus pandemic.
According to JD Power and LMC Automotive, the average transaction price for a new vehicle is expected to hit a record $ 40,206 in June. The previous monthly high of $ 38,539 was set in May 2021, according to the company.
The higher prices have led to higher profits for automakers and retailers, but also fueled more general inflation concerns. Consumer spending on new vehicles is expected to hit a record $ 149.7 billion in the second quarter, up 60.7% from 2020 and 27.9% more than 2019.
“While inventory shortages limit the volume of vehicles sold to consumers, the underlying strength of consumer demand is clear. Consumers buy more expensive vehicles despite lower discounts, which dramatically increases the profitability of those sales for both manufacturers and retailers, “said Thomas Dramatically King, president of data and analytics at JD Power, in a statement.
– CNBC’s Michael Bloom contributed to this report.