Car buyers are finally starting to see something they haven’t in a long time on dealership lots: more availability of cars and trucks.
Inventory levels for new vehicles, constrained through much of the pandemic due to supply-chain snarls, have begun to bounce back, leading many car companies to report higher U.S. auto sales in the first quarter. The strong results are a sign that the car sector is moving past some of the acute shortages that have dogged business in recent years.
General Motors Co.
said its U.S. sales jumped nearly 17.6% in the first quarter, helped along by strong pickup-truck demand and an increase in sales to fleet customers.
Hyundai Motor Co.
reported a 16% increase in its U.S. sales for the January-to-March period, attributing the rise in part to higher demand for its fully electric and hybrid models.
Nissan Motor Co.
posted a 17% increase for the quarter, while
Honda Motor Co.
’s U.S. sales were up 6.8% over the prior year.
Ford Motor Co.
is expected to report sales results Tuesday.
Toyota Motor Corp.
was one outlier, reporting a nearly 9% drop in U.S. sales for the January-to-March period.
Jack Hollis,
Toyota Motor Corp.’s
TM 0.02%
North American sales chief, said last week that he expected the period to be slow but sales would pick up again in the back half of the year.
“Our situation is improving,” he said. “The problem is our dealerships are just selling them faster than we’re producing them.”
Industrywide, U.S. auto sales are expected to hit 3.5 million for the first three months of this year, a 6% rise over the previous first-quarter period, according to estimates provided by J.D. Power, an industry research firm.
The quarterly increase in new-car sales, follows a difficult year in 2022, where the auto industry as a whole posted its worst annual performance in more than a decade.
The dismal results were largely driven by ongoing supply-chain problems and difficulties keeping factories running flat out, leaving dealers with little to sell and consumers paying top dollar to secure what was available.
The industry also is rebounding from a troubled start to 2022, when Russia’s invasion of Ukraine sparked troubles across the auto-industry supply chain and a scarcity of computer chips wreaked havoc on companies’ ability to build vehicles.
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Are you planning to buy a car this year? Join the conversation below.
Auto executives have said that some of those supply-side obstacles have been easing, particularly on semiconductors, with factory production schedules becoming more stabilized.
“We are really starting to see some positive inroads and the inventory is definitely improving,” said
Judy Wheeler,
Nissan’s vice president of U.S. sales.
Overall, the available stock at dealerships and in transit was 1.85 million units at the end of March, up roughly 50% from at the month’s end a year ago, according to Wards Intelligence, an industry data analytics firm.
That figure, however, is still well below the historic norm and dealers expect it could be a while before availability fully returns because many vehicles that hit lots are already preordered.
Some auto makers have also been stockpiling vehicles ahead of the spring selling season, a historically busy period for both manufacturers and car retailers.
Still, even as inventory levels come back, consumers are feeling new pressures that could hamper demand this year.
Recent interest-rate hikes are already adding to the cost of buying a new vehicle, further fueling concerns about affordability and whether more buyers are being priced out of the market.
In the first quarter, the average loan payment for a new automobile was $730 a month, about $75 higher than the period last year, according to Edmunds, a car-buying research firm.
The average interest rate on new vehicles financed during the early months of 2023 reached 7%, compared with 4.4% a year prior, Edmunds said.
Randy Parker, chief executive of Hyundai Motor America, said while consumer demand remains healthy, the higher interest rates are having an impact on buyers’ willingness to spend. He expects auto makers will continue to increase spending on sales promotions to help bring down costs for buyers.
“There’s still a lot of economic uncertainty right now,” Mr. Parker said. “There’s a lot of strong pent up demand but conversion is becoming a lot more challenging.”
The level of spending on sales promotions and other discounts has started to creep back up, rising 45.2% to an average $1,558 a vehicle in March, according to J.D. Power.
Sales of electric vehicles also picked up during the quarter with many auto makers highlighting the gains and new model roll outs that are helping to provide buyers with more choices.
Overall, EVs accounted for 8.5% of total auto-industry sales in the first quarter, which is up from the 5.3% recorded for full-year 2022, recorded in the same time last year, according to J.D. Power.
Tesla Inc.,
which doesn’t break out U.S. sales, said Sunday it had delivered a record 422,875 vehicles to customers globally in the first quarter, up around 36% compared with a year prior. During the quarter, Tesla cut prices to juice demand in a cooling market.
EV startup
Rivian Automotive Inc.
continued to struggle with boosting both factory output and deliveries of its debut models in the first-quarter, reporting Monday declines of 6% and 1.3% respectively from the final quarter of 2022.
Rivian said it remains on track to produce 50,000 vehicles total in 2023. Its stock fell 2% in Monday morning trading.
Write to Ryan Felton at ryan.felton@wsj.com
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Car buyers are finally starting to see something they haven’t in a long time on dealership lots: more availability of cars and trucks.
Inventory levels for new vehicles, constrained through much of the pandemic due to supply-chain snarls, have begun to bounce back, leading many car companies to report higher U.S. auto sales in the first quarter. The strong results are a sign that the car sector is moving past some of the acute shortages that have dogged business in recent years.
General Motors Co.
said its U.S. sales jumped nearly 17.6% in the first quarter, helped along by strong pickup-truck demand and an increase in sales to fleet customers.
Hyundai Motor Co.
reported a 16% increase in its U.S. sales for the January-to-March period, attributing the rise in part to higher demand for its fully electric and hybrid models.
Nissan Motor Co.
posted a 17% increase for the quarter, while
Honda Motor Co.
’s U.S. sales were up 6.8% over the prior year.
Ford Motor Co.
is expected to report sales results Tuesday.
Toyota Motor Corp.
was one outlier, reporting a nearly 9% drop in U.S. sales for the January-to-March period.
Jack Hollis,
Toyota Motor Corp.’s
TM 0.02%
North American sales chief, said last week that he expected the period to be slow but sales would pick up again in the back half of the year.
“Our situation is improving,” he said. “The problem is our dealerships are just selling them faster than we’re producing them.”
Industrywide, U.S. auto sales are expected to hit 3.5 million for the first three months of this year, a 6% rise over the previous first-quarter period, according to estimates provided by J.D. Power, an industry research firm.
The quarterly increase in new-car sales, follows a difficult year in 2022, where the auto industry as a whole posted its worst annual performance in more than a decade.
The dismal results were largely driven by ongoing supply-chain problems and difficulties keeping factories running flat out, leaving dealers with little to sell and consumers paying top dollar to secure what was available.
The industry also is rebounding from a troubled start to 2022, when Russia’s invasion of Ukraine sparked troubles across the auto-industry supply chain and a scarcity of computer chips wreaked havoc on companies’ ability to build vehicles.
SHARE YOUR THOUGHTS
Are you planning to buy a car this year? Join the conversation below.
Auto executives have said that some of those supply-side obstacles have been easing, particularly on semiconductors, with factory production schedules becoming more stabilized.
“We are really starting to see some positive inroads and the inventory is definitely improving,” said
Judy Wheeler,
Nissan’s vice president of U.S. sales.
Overall, the available stock at dealerships and in transit was 1.85 million units at the end of March, up roughly 50% from at the month’s end a year ago, according to Wards Intelligence, an industry data analytics firm.
That figure, however, is still well below the historic norm and dealers expect it could be a while before availability fully returns because many vehicles that hit lots are already preordered.
Some auto makers have also been stockpiling vehicles ahead of the spring selling season, a historically busy period for both manufacturers and car retailers.
Still, even as inventory levels come back, consumers are feeling new pressures that could hamper demand this year.
Recent interest-rate hikes are already adding to the cost of buying a new vehicle, further fueling concerns about affordability and whether more buyers are being priced out of the market.
In the first quarter, the average loan payment for a new automobile was $730 a month, about $75 higher than the period last year, according to Edmunds, a car-buying research firm.
The average interest rate on new vehicles financed during the early months of 2023 reached 7%, compared with 4.4% a year prior, Edmunds said.
Randy Parker, chief executive of Hyundai Motor America, said while consumer demand remains healthy, the higher interest rates are having an impact on buyers’ willingness to spend. He expects auto makers will continue to increase spending on sales promotions to help bring down costs for buyers.
“There’s still a lot of economic uncertainty right now,” Mr. Parker said. “There’s a lot of strong pent up demand but conversion is becoming a lot more challenging.”
The level of spending on sales promotions and other discounts has started to creep back up, rising 45.2% to an average $1,558 a vehicle in March, according to J.D. Power.
Sales of electric vehicles also picked up during the quarter with many auto makers highlighting the gains and new model roll outs that are helping to provide buyers with more choices.
Overall, EVs accounted for 8.5% of total auto-industry sales in the first quarter, which is up from the 5.3% recorded for full-year 2022, recorded in the same time last year, according to J.D. Power.
Tesla Inc.,
which doesn’t break out U.S. sales, said Sunday it had delivered a record 422,875 vehicles to customers globally in the first quarter, up around 36% compared with a year prior. During the quarter, Tesla cut prices to juice demand in a cooling market.
EV startup
Rivian Automotive Inc.
continued to struggle with boosting both factory output and deliveries of its debut models in the first-quarter, reporting Monday declines of 6% and 1.3% respectively from the final quarter of 2022.
Rivian said it remains on track to produce 50,000 vehicles total in 2023. Its stock fell 2% in Monday morning trading.
Write to Ryan Felton at ryan.felton@wsj.com
Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8