U.S. Sales and inventory rates are up modestly from last year, says a new report from Cox Automotive. However prices for new vehicles remain high, despite the new supply available. Sales are expected to increase nearly four per cent from last year, and last month. While the February 2023 auto sales pace, or seasonally adjusted annual rate (SAAR), is expected to reach 14.4 million, a decline from January’s “surprisingly strong” 15.7 million level, with elevated auto loan rates and persistent inflation, a sales pace decline from January was expected by Cox Automotive.
Affordability is “a growing headwind” for vehicle buyers but is impacting new and used sales differently as the spring season approaches. “We have diverging markets today. New-vehicle prices remain high while used retail prices are now in decline,” said Charlie Chesbrough, senior economist at Cox Automotive.
“New inventory is slowly stabilizing while used supply is falling. However, I wouldn’t be surprised to see this situation change later in the spring. With many affordability-seeking vehicle buyers leaving the new market for the used, dealers may find they have too little used inventory, and price declines may reverse. And, OEMs may find they have too much new-vehicle inventory and be forced to be more aggressive with incentives to boost sales.”
February 2023 Sales Forecast Highlights
- Light vehicle sales are expected to finish near 1.105 million, a 3.9% rise from last month and a 4.0% increase from February 2022.
- The SAAR in February 2023 is estimated to be 14.4 million, above last February’s 13.7 million level but down from January’s 15.7 million pace.
- Fleet sales are expected to show strong year-over-year gains over February 2022’s inventory-limited market.
- February 2023 has 24 selling days, equal to both February 2022 and January 2023.
