By TOM KRISHER (AP Auto Writer)
DETROIT (AP) — Undeterred by excessive costs, rising rates of interest, autoworker strikes and a computer-chip scarcity that slowed meeting strains, American customers nonetheless purchased 15.6 million new automobiles final 12 months, 12% greater than in 2022, the largest enhance in additional than a decade.
Yet gross sales nonetheless haven’t returned to the 17 million fee within the years earlier than the pandemic, and there are indicators of a cooling market as patrons aren’t as keen to pay astronomical costs that sellers and producers have been charging simply months in the past.
“You see the consumer making a concerted effort to ensure that they’re getting the best price possible,” stated Jonathan Chariff, CEO of South Automotive Group, a 10-dealership group within the Miami space. “They basically feel that this is the right time to buy from a perspective of being able to get the discounts.”
Average auto gross sales costs peaked in December of 2022 simply over $47,300, with automobiles in brief provide due to the worldwide chip scarcity that restricted manufacturing. Some sellers have been capable of cost over the sticker worth to patrons who wanted a brand new journey or had the cash to get one.
But the chip scarcity regularly eased final 12 months to the purpose the place it’s almost over, and meeting strains are working at close to regular speeds. General Motors, Ford and Stellantis endured six-week strikes by the United Auto Workers that ended final fall. As a outcome, car provides on supplier tons are robust and rising, and costs are beginning to fall as automakers and sellers dangle reductions.
Data from J.D. Power present that common costs in mid-December have been down 2.7% from the height, to round $46,000. But they’re nonetheless nowhere close to pre-pandemic costs attributable to a 26% runup from 2020 to 2022 as cash-rich patrons drove up costs primarily by shopping for loaded-out vehicles and SUVs. That was about 10 share factors greater than the inflation fee for a similar interval.
Still, Jonathan Smoke, chief economist for Cox Automotive, stated he expects the hole between the sticker worth and the transaction worth that customers pay to widen this 12 months. “We do think that the tables start to turn in 2024,” he stated. “Discounting will be the key difference in why transaction prices are declining.”
Discounts, on common, greater than doubled 12 months over 12 months in November, Smoke stated. “I think we’re starting to see signs that manufacturers are starting to put more into making financing more attractive,” he stated, including that they’re additionally providing extra engaging lease offers.
New car loans averaged round 7% for many of the 12 months, and people may drop even when the Federal Reserve doesn’t begin to lower charges, Smoke stated.
He and Chariff additionally say that sellers have needed to low cost as nicely. In South Florida, Chariff stated he isn’t seeing buyer demand again off. His dealerships had robust December gross sales with out the traditional lull through the week earlier than Christmas.
There could also be extra patrons on the decrease, extra reasonably priced finish of the market, which already was heating up final 12 months as provides rose. For instance, gross sales of the Chevrolet Trax small SUV, which begins at $21,495 together with delivery, grew to greater than 109,000 final 12 months, 4 instances the 2022 quantity.
Electric car gross sales grew 47% to a document 1.19 million for the complete 12 months, in keeping with Motorintelligence.com. The EV market share grew from 5.8% in 2022 to 7.6% final 12 months. But EV gross sales development slowed towards the tip of the 12 months. In December, they rose 34%.
Gas-electric hybrid gross sales grew 54% to 1.2 million final 12 months, with market share leaping from 5.6% in 2022 to 7.7%.
Among producers, General Motors, the highest vendor within the U.S., posted a robust 14% gross sales enhance for the 12 months. Toyota gross sales grew 7%, whereas Honda was up 33%. Nissan gross sales grew 23%, with Hyundai up 12%. Stellantis, maker of Jeep, Ram and different automobiles, noticed its gross sales drop about 1% for the 12 months.
Ford’s F-Series pickup vehicles are prone to stay the highest promoting car within the U.S. when the corporate experiences numbers on Thursday. But General Motors stated it offered extra full-size pickups than Ford — 839,517 — with its Chevrolet Silverado and GMC Sierra mixed.
Toyota’s RAV4 small SUV was the nation’s top-selling car that wasn’t a pickup truck. RAV4 gross sales rose 9% final 12 months to virtually 435,000.
Source: www.bostonherald.com”