By James Hickey
Managing Editor, digitaldealer.com
October new-vehicle sales in the U.S. continued to remain strong despite worries the effect of the United Auto Workers (UAW) strike would have, as initial estimates show the seasonally adjusted annual rate (SAAR) came in right at the year-to-date average of 15.5 million, and sales volume was 1.2 million in October, according to Cox Automotive.
New-vehicle sales volume in the U.S. rose nearly 4% over October 2022, a market Cox Automotive officials noted was in the early stages of recovery from severe product shortages.
“Though there are many headwinds in the market today, new-vehicle sales continue to show gains over last year’s supply-constrained market,” said Charlie Chesbrough, senior economist at Cox Automotive, in a press statement. “Concerns about high interest rates, a potential economic recession, and the…UAW strike are all likely holding back some potential vehicle buyers. However, there are still enough individuals and businesses with the need and ability to buy vehicles, which has helped sustain the sales recovery.”
Seven Straight Months Above 15M
October marked the seventh consecutive month with a sales pace above 15 million, but a decline in fleet sales for the Detroit Big 3 did drag what could have been a bigger month. Experts offered that U.S. while sales for the Detroit brands were likely reflecting a small impact from the UAW strike, the walkout had little near-term impact on new-vehicle sales, as inventory levels remained mostly healthy throughout October.
Foreign automakers did benefit from improved inventory and showed sales growth. Honda Motor Co. and Toyota Motor Corp posted October sales increases in the U.S. Toyota’s inventory has been recovering quickly since the summer, allowing them to regain share from Honda and Nissan, according to Cox. Additionally, Hyundai and Kia reported positive sales growth for the 15th consecutive month as well.
Industry leaders highlighted that a key driver of new-vehicle sales strength has been growing inventory levels across the industry. Estimates from vAuto in mid-October suggested new-vehicle inventory in the U.S. was at 2.3 million units, up from 2.1 million in mid-September when the strike began, and an increase of 800,000 units from mid-October 2022.
No UAW Strike Effect
According to Cox estimates, days’ supply in mid-October reached 62—compared with 48 October 2022—the highest point since the spring of 2021.
Toyota and Honda continue to have the lowest measure of days’ supply, at under 23 days. Of the U.S. brands, Chevrolet and Cadillac had the tightest supply in mid-October, both below the industry average of 62. Ford had 90 days’ supply in the same timeframe, while Lincoln and Stellantis brands had inventory levels were above 100 days’ supply.
“While the UAW strike [certainly slowed] down production at select assembly plants across the U.S., the impact has not yet fully materialized for consumers in the showroom,” noted Chesbrough. “Compared to this point last year, industry inventory levels are much higher, which is helping support—to this point at least—relatively healthy new-vehicle sales.”