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US New-Vehicle Sales To Rise By 13% In December

Strong discounts and vehicle availability are likely to propel U.S. new-vehicle sales to jump roughly 13% in December compared to the same month last year, according to a joint estimate released on Thursday by industry consultants, J.D. Power and GlobalData.

The research projects that total new-vehicle sales, including both retail and non-retail transactions, will reach approximately 1,396,700 vehicles in December, up 13.2% from the same month the previous year.

The automotive industry is set to enjoy a robust year as total sales were just under 15.5 million, a significant 12.8% increase from last year’s sales, the report said.

Inventory levels are also currently at their highest since the early spring of 2021, leaving dealers and automakers scurrying to make way for new models, which are set to pour in by January.

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Car dealers are providing generous incentives and discounts during winter sales, aiming to clear stocks of older vehicles and capitalize on sustained demand.

The report estimates incentive spending per unit to reach $2,458 in the month, up from $1,289 last year, encouraging consumers to spend about $50.4 billion on new vehicles, up by $2.4 billion.

“Sales growth for December is being enabled by improving vehicle availability and affordability,” said Thomas King, president of the data and analytics division at J.D. Power.

However, the increase in new-vehicle supply and higher interest rates are resulting in falling per-unit dealer profits, although those profits continue to exceed pre-pandemic levels, the report added.

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