Cox Automotive Forecast: August New-Vehicle Sales Pace Slowest of 2021 Due to Low Supply
-Annual new-vehicle sales pace in August is forecast to finish near 14.3 million, the slowest pace in 2021. This pace reflects another downtick from last month's supply-constrained 14.8 million and is the slowest since June 2020 when it was 13.0 million.
-August sales volume is expected to fall nearly 9% from one year ago and finish near 1.20 million units.
-The ongoing low supply situation is keeping the sales pace well below August 2020's early post-COVID-19 recovery pace of 15.2 million.
ATLANTA, Aug. 25, 2021 /PRNewswire/ -- U.S. auto sales are forecast to be squeezed even tighter in August by a worsening supply situation. The pace of auto sales, or seasonally adjusted annual rate (SAAR), is expected to finish near 14.3 million, the slowest sales pace this year, according to a Cox Automotive forecast released today. The August pace will be down from July's 14.8 million pace and down from August 2020's 15.2 million level, after averaging nearly 17.0 million a month through May.
Sales volume is expected to finish near 1.20 million, down 9% from last August, which had one additional selling day, and down nearly 7% from last month. August's finish would be the fourth consecutive monthly decline of 500,000 units or more since April's post-pandemic peak pace of 18.3 million.
The supply situation will likely worsen over the coming weeks. According to Cox Automotive Senior Economist Charlie Chesbrough: "Available inventory on dealer lots has been falling for months, and sales have been constrained further and further as a result. And soon the market will enter the Labor Day holiday weekend, usually one of the highest sales periods of the entire year, but with half the supply they had last year."
The automotive market started the year with tight supply, and inventory levels have continued to deteriorate. New-vehicle inventory levels are over 50% lower than they were a year ago, when inventory was already below healthy levels, and supply chain issues continue to disrupt production. Most OEMs have been forced to cut production due to a lack of computer chips. The problem promises to persist this fall. Both Nissan and Toyota recently announced production shutdowns that will limit their available inventory within weeks. It is expected that the next few months will be particularly challenging as new-vehicle sales will be choked off from the lack of product available on dealer lots. Many OEM supply issues are expected to improve in Q4, but the outlook for 2022 is that tight supplies will continue to be a strong headwind for the industry.
August 2021 New-Vehicle Sales Forecast Highlights
In August, new light-vehicle sales in the U.S. are forecast to fall to 1.20 million units, or down 118,000 units, nearly 9% below last year. Compared to last month, sales are expected to fall 88,000 units, or almost 7%.
The SAAR in August 2021 is estimated to be 14.3 million, down from last August's early COVID-19 recovery pace of 15.2 million, and down from July's 14.8 million supply-constrained level.
The only segment that is expected to see a year-over-year increase in August is compact cars, but still lower than 2019. The increase is likely due to availability and affordability as well as being an alternative to used vehicles which are also in short supply.
August 2021 New-Vehicle Sales Forecast
Full-Size Pickup Truck
1 Cox Automotive Industry Insights data
2 Total includes segments not shown
All percentages are based on raw volume, not daily selling rate.
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