According to an estimate by Cox Automotive, the robust year-over-year sales recovery continued in the third quarter. Despite rising interest rates on new-vehicle loans and a UAW strike against the major domestic manufacturers, September sales volumes are expected to exceed about 1.3 million, a more than 13% rise from 2022. Moreover, sales in Q3 are predicted to top 3.9 million, up more than 15% from the same period last year.
As the first three-quarters of 2023 close, Charlie Chesbrough, senior economist at Cox Automotive, observed that many auto analysts may feel “pleasantly surprised.”
The market has experienced high interest rates, genuine affordability concerns, and ongoing inflation, all of which have the potential to cause significant drops in vehicle sales. On the other hand, this year’s vehicle market has been driven by a backlog of demand.
Additionally, the September seasonally adjusted sales pace, or SAAR, is estimated to be approximately 15.5 million in the final month of Q3. This is a slight increase over the August total of 15.0 million and is getting closer to the rate of 15.7 million from July. Sales for September are anticipated to increase in volume over the supply-constrained market of the previous year by more than 13%.
“The market’s success this year, however, has not been a retail success story,” Chesbrough continued. “Our study shows that the market has seen significant growth in rental and commercial fleet sales, up 62% and 40%, respectively, year to date.” These outlets had lacked merchandise during the new vehicle inventory shortfall. However, things have started to change in 2023, and fleet sales have also increased.
General Motors will continue to lead the industry in terms of sales volume, with year-to-date sales expected to increase by about 19% through Q3. The other prominent players, including Toyota, Ford, and Stellantis, are expected to underperform the industry through the first nine months.
With year-over-year growth of 49% and 36%, respectively, Honda and Nissan are predicted to outperform the industry significantly in the third quarter. With sales rising more than 31% in the third quarter, Tesla is also anticipated to report strong results. Tesla’s sales performance has improved due to price reductions almost 20% lower than last year.