2022 is coming to an end and it is shaping up to be a year that car manufacturers would like to forget, and that is, they estimate that it would be the worst year for car sales in the US in more than a decade.
While final numbers should be available in early 2023, Cox Automotive estimates that automakers will have sold almost 13.9 million vehicles in United States. If that number is met, it would be a 8% drop from 2021 and a decline of about 4.8% since 2020, when the economy ground to a halt as a result of the COVID-19 pandemic. Even more revealing would be the worst result since 2011.
They estimate that 2022 would be the worst year for car sales in the US
Cox points out that 2022 was a year of challenges, since it began with problems in the supply chain and the continuous chip crisis. Things got worse from there as interest rates skyrocketed as the Federal Reserve sought to keep inflation in check. This had a devastating impact, as Cox noted that the costs of auto loans increased to “levels not seen in more than 20 yearsdriving some buyers out of the market due to concerns about the affordability of the vehicles.”
The effect can be seen in the sales chart, as Cox noted that the pace of sales has slowed by almost 2 million units since October. This was despite rising inventories, Senior Economist Charles Chesbrough stated: “Given the vast improvement in supply levels, it seems likely that rising interest rates are now constraining demand in the auto retail market.” . He added that “with record prices and high loan rates, the pool of potential new car buyers is shrinking.”
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It is expected that GM become the best-selling automaker in the United States, as Cox estimates it will sell 2,253,641 units this year. That would put them about 131,000 units ahead of Toyotawhich is expected to suffer a 9% drop in sales.
Ford is scheduled to finish third with close to 1,837,603 units, while Stellantis and Hyundai/kia round out the top five. Tesla looks like the big winner with a projected 48.9% increase in sales, while it is expected that Sling falter with a drop of 33.3%.
While 2022 was a tough year for manufacturers as well as consumers, 2023 doesn’t look much better as Cox expects vehicle affordability to remain an issue. Although he expects a modest increase in sales compared to 2022.
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Fountain: carscoops
