According to the joint report, June’s total fleet and retail volume will be 22.6% higher than in 2022. Excluding fleet customers, dealers sold roughly 1.11 million retail units, a slightly lower increase of 16.6%. Assuming these estimates are accurate, the automotive industry will have sold a mid-year total of 4.12 million new vehicles by July. Although this year’s sales are still behind the pre-pandemic average, Thomas King, J.D. Power president of data analytics, anticipates “that consumers will spend nearly $281.4 billion” on new cars by the end of the month, 8% more than during the previous year.
Driving these gains are improvements in new vehicle inventory, which the report says will reach 1.2 million units before the end of the month, roughly 170,000 more than May’s total supply. Dealerships continue to rake in near-unprecedented earnings on new vehicle sales, although J.D. Power notes that margins are beginning to shrink under normalizing production. The research firm forecasts total retailer profit per new vehicle to hit $3,692 this June, a decrease of 26.7% from the same period in 2022 but more than twice what storefronts made in June 2019. Dealers are projected to make $3.8 billion this month, the third-highest amount seen in June.
While these numbers are favorable, the coming months may be more difficult for the automotive industry. Interest rates, high new vehicle prices, and other financial factors still present challenges for both dealers and their consumers. However, King argues that retailers still have much to look forward to. “Despite the potential effect of these economic risks, the industry will continue to benefit from pent-up demand for new vehicles.”