Supply Constraints, Lack of Inventory Cap US Light Vehicle Sales in September

13.4 million-unit SAAR Expected for 2022

S&P Global Mobility analysts expect US light vehicle sales
to be limited to 1.105 million units in September, marking an
annual rate of 13.4 million units. The cumulative impacts of supply
shocks on auto manufacturing in North America and globally continue
to severely constrain sales by limiting the availability of new
inventory to consumers. While wholesale prices for new vehicles are
up a subdued 3.7%, consumer prices for new vehicles are posting
double-digit year-over-year gains. Consumers’ willingness to pay
for available vehicles at these prices is evidence that pent-up
demand remains in the market.

“Production issues relating to ongoing shortages, especially
for semiconductors, and other supply chain, labor, and logistics
issues will continue to translate into US inventory remaining at
below-average levels, under 2.0 million units or a 40 days’ supply,
well into 2023,”
said Joe Langley, associate director, US
production analysis, S&P Global Mobility.

Despite the tight inventory picture industrywide, the
battery-electric vehicle (BEV) segment continues to see share
gains. Numerous automakers are introducing BEV models in new body
style segments, spreading the technological impact of electric
vehicles to an increasing population of buyers. BEVs sitting beside
legacy internal combustion engine vehicles in dealer showrooms are
enticing more consumers to the new segment. The importance of the
transition to BEVs was highlighted at the recent Detroit Auto

“The event embodied the dynamics of today’s auto market and
the interplay between needing to support current demand for ICE
products and the need for helping consumers along the path of
transitioning to electrification and EVs,”
added Stephanie
Brinley, principal research analyst, S&P Global Mobility.

Through September year-to-date 2022, volumes will likely be down an
estimated 1.6 million units compared to the 11.7 million units
year-to-date in 2021. Through the end of the year, the S&P
Global Mobility forecast for 2022 sits at 14.0 million units,
although risks to the downside remain.

On a manufacturer level, September volumes will remain
consistent with recent results. One less selling day in September
compared to August will result in slow m/m volume comparisons but
expected manufacturer performances for the month reflect the
ongoing market conditions.

This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.

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