S&P Global Mobility: Progress of US auto sales remains unsteady

Rhea-AI Summary

S&P Global Mobility forecasts U.S. light vehicle sales to hit 1.29 million units in April 2023, marking a 4% increase from April 2022. This figure suggests a sales pace of 15.2 million units SAAR, comparable to Q1 2023. Despite ongoing improvements, sales remain cautious due to factors such as consumer affordability concerns and economic uncertainty. North American production in March 2023 reached 1.45 million units, the highest in 30 months. While BEV sales are estimated at over 7% share, volatility is expected due to federal EV incentives and pricing adjustments. Overall, demand may shift from inventory issues to consumer affordability challenges, impacting new vehicle pricing.

Positive

• April 2023 light vehicle sales projected at 1.29 million units, up 4% from April 2022.
• Sales pace estimated at 15.2 million units SAAR, steady with Q1 2023 levels.
• March 2023 production reached 1.45 million units, highest in 30 months.
• BEV sales share estimated above 7%, with sustained interest in new models.

Negative

• Auto sales face potential volatility due to rising affordability concerns and uncertain consumer confidence.
• Shift from inventory-driven demand to consumer affordability challenges could create downward pressure on vehicle pricing.

New light vehicle sales in April are expected to maintain the pace of the preceding months; uncertainty remains for remainder of year

SOUTHFIELD, Mich., April 25, 2023 /PRNewswire/ -- S&P Global Mobility estimates new light vehicle sales volume in April 2023 to reach 1.29 million units, up approximately 4% from April 2022 and representing the ninth consecutive month in which volume has improved from the year-ago level. This volume would translate to an estimated sales pace of 15.2 million units SAAR (seasonally adjusted annual rate), in line with the first quarter 2023 average of 15.3 million units.

S&P Global Mobility estimates new light vehicle sales volume in April 2023 to reach 1.29 million units.

"Auto sales remain stuck at current levels," said Chris Hopson, principal analyst at S&P Global Mobility. "With an auto sales environment currently defined by the mixed signals of mildly advancing production, inventory and incentives on one hand, and rising affordability concerns and uncertain consumer confidence levels on the other, expected demand in April falls under the 'no news is good news' category. Auto sales will remain subject to the unsteadiness apparent in the overall economy, with the likelihood of month-to-month volatility ahead."

While sales continue to waver, the supply side of the auto equation is beginning to show some sustained signs of improvement. According to Joe Langley, associate director at S&P Global Mobility, "North American production results for March 2023 (the most recent data available) are estimated to total 1.45 million units, translating into 15.82 million units produced on a SAAR basis. That is the highest level in 30 months."

S&P Global Mobility analysts do not expect sales volumes over the next several months to dynamically change from the current trend. However, demand-level constraints may shift from being inventory-driven to more consumer-facing vehicle affordability challenges, by way of continued high prices, uncertain economic conditions, rising interest rates and tighter credit conditions. That could lead to increasing inventories providing some sustained downward pressure on new vehicle pricing.

U.S. Light Vehicle Sales
		Apr 23 (Est)	Mar 23	Apr 22
Total Light Vehicle	Units, NSA	1,290,000	1,365,966	1,236,432
	In millions, SAAR	15.2	14.8	14.3
Light Truck	In millions, SAAR	12.1	11.8	11.4
Passenger Car	In millions, SAAR	3.1	3.0	2.9
Source: S&P Global Mobility (Est), U.S. Bureau of Economic Analysis

Continued development of battery-electric vehicle (BEV) sales remains a constant assumption for 2023. However, the implementation of the US federal EV incentive eligibility, ongoing price adjustments from Tesla, and the Department of Energy's downward restating of e-MPG ratings for electric vehicles could translate into monthly BEV share becoming a bit more volatile in the upcoming months.

The sales share of BEVs through the first quarter of 2023 is estimated to be above 7%. On a projected level of 7% for April, BEV share is expected to remain on trend. Beyond the pricing developments, a sustained churn of new and refreshed BEVs will continue to promote BEV sales as the year progresses.

About S&P Global Mobility

At S&P Global Mobility, we provide invaluable insights derived from unmatched automotive data, enabling our customers to anticipate change and make decisions with conviction. Our expertise helps them to optimize their businesses, reach the right consumers, and shape the future of mobility. We open the door to automotive innovation, revealing the buying patterns of today and helping customers plan for the emerging technologies of tomorrow.

S&P Global Mobility is a division of S&P Global (NYSE: SPGI). S&P Global is the world's foremost provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity, and automotive markets. With every one of our offerings, we help many of the world's leading organizations navigate the economic landscape so they can plan for tomorrow, today. For more information, visit www.spglobal.com/mobility.

Media Contact:

Michelle Culver
S&P Global Mobility
248.728.7496 or 248.342.6211
Michelle.culver@spglobal.com

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SOURCE S&P Global Mobility

FAQ

What are the projected light vehicle sales for April 2023 by S&P Global Mobility?

S&P Global Mobility projects light vehicle sales for April 2023 to reach 1.29 million units.

How do April 2023 light vehicle sales compare to April 2022?

April 2023 light vehicle sales are expected to be approximately 4% higher than in April 2022.

What is the sales pace of light vehicles in April 2023?

The sales pace for April 2023 is estimated at 15.2 million units SAAR.

What was the production level of light vehicles in March 2023?

Light vehicle production in March 2023 reached 1.45 million units, the highest in 30 months.

What challenges are affecting auto sales according to S&P Global Mobility?

Challenges include rising affordability concerns, uncertain consumer confidence, and potential shifts in demand affecting vehicle pricing.