A year after losing the title it held for nearly a century as the top car seller in the United States, General Motors is back on top. On Wednesday, GM reported U.S. sales of 2.3 million vehicles. Strong fourth-quarter sales, up 41% from a year ago, helped it close the year with sales up nearly 3% from the 2.2 million U.S. vehicles it sold in 2021 when it suffered a decline of 13%. Meanwhile, Toyota, which had captured the top sales spot in 2021, saw its full-year sales fall nearly 10% to 2.1 million, although it posted a 13% increase in sales of the fourth quarter. the shortage of parts, mainly computer chips, needed to build the cars and trucks that consumers wanted. Total new vehicle sales in the U.S. are expected to fall to just under 14 million vehicles when final industry-wide sales results are reported later this week. That would be the lowest sales total since the country had just emerged from the Great Recession. than a decade ago Sales bottomed out at 10.5 million in 2009, the year GM and Chrysler filed for bankruptcy and received federal bailouts, and had only rebounded to 12.7 million in 2011, the last year the industry sales fell below 14 million. Sales had been 17 million in 2019. , the year before the pandemic upended both the economy and supply chains. Most forecasts say supply chain issues are improving, and that should allow automakers to ramp up production in 2023. They point to better sales coming in the fourth quarter than at the start of year as proof of that, even with higher car prices and rising interest rates making them more expensive for buyers than in the past. This has led them to forecast a modest increase in sales this year to north of 14 million vehicles once. Again. But many experts caution that the forecast for increased sales depends on the US economy not falling into recession and instead simply experiencing slower growth. And uncertainty about what will happen to the economy makes the outlook for auto sales much more uncertain than in previous years, they say. “I’ve been forecasting the auto market for decades. This coming year is the hardest,” he said. Charlie Chesbrough, Chief Economist, Cox Automotive. “Usually we have an idea of where it’s headed. But this year, it could go up or down.” There are a number of factors supporting new car sales next year, even if the economy stumbles. One is the fact that rental car companies have been unable to buy the supply of new cars they need in the past two years, as carmakers have limited the supply of cars available for fleet sale in lower price, selling all or practically all the cars they had. “The rental companies have been running half the purchases they’re used to,” said Ivan Drury, chief information officer at Edmunds. And Drury said that if automakers start to see weakness in consumer demand, they can bring back incentives, including lower-rate financing, that they haven’t had to offer in recent years when more demand than supply. “Incentives recently have been pretty much nothing,” he said. So far, demand is still strong, as there is a backlog of potential buyers who have delayed purchases because they couldn’t find the vehicle they wanted. But both Drury and Chesbrough say higher average prices and higher interest rates are already driving buyers out of the market. A turn in the economy, especially if historically low unemployment rates begin to rise, could quickly lead to a decline in new car sales.
A year after losing the title it held for nearly a century as America’s top auto seller, General Motors is back on top.
On Wednesday, GM reported U.S. sales of 2.3 million vehicles. Strong fourth-quarter sales, up 41% from a year ago, helped it close the year with sales up nearly 3% from the 2.2 million U.S. vehicles it sold in 2021 when it suffered a decline of 13%.
Meanwhile, Toyota, which had clinched the top sales spot in 2021, saw its full-year sales fall nearly 10% to 2.1 million, although it posted a 13% rise in sales of the fourth quarter.
In each of the past two years, industry-wide auto sales were constrained by shortages of parts, mainly computer chips, needed to build the cars and trucks that consumers wanted. Total new vehicle sales in the United States are expected to drop to just under 14 million vehicles when final industry sales results are reported later this week.
It would be the lowest sales total since the country was just emerging from the Great Recession more than a decade ago. Sales bottomed out at 10.5 million in 2009, the year GM and Chrysler filed for bankruptcy and received federal bailouts, and had only rebounded to 12.7 million in 2011, the last year that industry sales fell below 14 million.
Sales had been 17 million in 2019, the year before the pandemic upended both the economy and supply chains.
Most forecasts say supply chain issues are improving and that should allow automakers to ramp up production in 2023. They point to better sales coming in the fourth quarter than earlier this year as evidence of this, even with higher car prices. and rising interest rates make it more expensive for buyers than in the past.
This has led them to forecast a modest increase in sales this year to north of 14 million vehicles once again.
But many experts caution that the forecast for increased sales depends on the US economy not falling into recession and simply experiencing slower growth. And uncertainty about what will happen to the economy makes the outlook for car sales much more uncertain than in previous years, they say.
“I’ve been forecasting the auto market for decades. This coming year is the most challenging,” said Charlie Chesbrough, chief economist at Cox Automotive. “Usually we have an idea of where it’s headed. But this year, it could be up or down.”
There are a number of factors supporting new car sales next year, even if the economy stumbles. One is the fact that rental car companies have been unable to buy the supply of new cars they need in the past two years, as carmakers have limited the supply of cars available for fleet sale in lower price, selling all or practically all the cars they had. instead, it had to consumers.
“The rental companies have been running half the purchases they’re used to,” said Ivan Drury, chief information officer at Edmunds.
And Drury said that if automakers start to see a weakness in consumer demand, they may bring back incentives, including lower-rate financing, that they haven’t had to offer in recent years when demand was higher. what offer
“The incentives recently have been pretty much nothing,” he said.
So far, demand remains strong as there is a backlog of potential buyers who have delayed purchases because they couldn’t find the vehicle they wanted. But both Drury and Chesbrough say higher average prices and higher interest rates are already driving buyers out of the market.
A turn in the economy, especially if historically low unemployment rates begin to rise, could quickly lead to a decline in new car sales.
