Cox Automotive released its October forecast this week, showing that new car sales volume in the US is likely to increase compared to last year—signaling potential improvements in the new vehicle market.
According to the forecast, October’s US new car sales volume is expected to increase by 4.4% year-over-year and finish with 1.11 million units sold, delivering a seasonally adjusted annual rate (SAAR) for October of 14.3 million.
That would be the fastest sales rate since April and a significant increase from September’s 13.5 million level. However, Cox Senior Economist, Charlie Chesbrough, said that gain is more likely a “statistical trick” resulting from an additional selling day. October 2022 had 26 selling days, one more than September.
“It seems more likely that the statistical adjustments made to reflect an additional selling day are lifting the SAAR rather than a noticeable uptick in sales across the marketplace,” Chesbrough said.
In October 2021, the market was severely undersupplied, with national new car inventories averaging 1 million units and sales of only 13.2 million. Since then, vehicle inventories have increased, especially over the past three months, and the recent sales speed is probably a result of more readily available products at some auto dealerships.
“The vehicle market is being supported by improving inventories and product selection for some, but not all, brands,” Chesbrough said. “However, rising interest rates are pushing monthly payments higher for everyone, and many potential buyers are being knocked out of the market.”
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