New vehicle sales in the United States in November are expected to increase by 10.2% year over year to 1,236,000 units, according to a joint report from J.D. Power and GlobalData released on Wednesday.
As sales growth is supported by improving vehicle availability, the average new vehicle price is forecast to decline to $45,332, down 1.9% or $873 from November 2022.
“November results indicate a robust performance with double-digit year-over-year sales growth and record consumer expenditures for the month,” J.D. Power president of data and analytics Thomas King said in a statement.
“The consumer expenditure record was due to strong sales growth, which outweighed a 1.9% decline in transaction prices. Even with the decline in average transaction prices, consumers are on track to spend nearly $44.5 billion on new vehicles this month, the highest on record for the month of November and 9.5% higher than November 2022.”
Despite nearly six weeks of work stoppages related to the United Auto Workers (UAW) strike, retail inventory levels in November are expected to be 1.6 million, up 7.5% from the previous month and a 43.7% increase year over year.
However, this remains more than 40% below pre-pandemic levels, King pointed out.
Vehicle sales to fleet customers are expected to decrease by 2.4% when compared to November 2022.
“The increase in new-vehicle supply and higher interest rates are resulting in falling per unit dealer profits, but those profits continue to exceed pre-pandemic levels,” King said.
“The total retailer profit per unit, which includes grosses, finance and insurance income, is expected to be $3,002 in November. While this is 28.7% lower than a year ago, it is still more than double the amount in November 2019.”
With the autoworkers' strike wrapped up, the industry can now focus on production, product launches and year-end sales promotions, King said. He sees the trends seen in November continuing.
“Incremental enhancements in vehicle availability are expected to further improve the pace of new-vehicle sales, while per-unit prices and profitability are anticipated to experience measured moderation,” he said.
“Despite the challenges posed by rising interest rates and declining used-vehicle values, the overall health of the new-vehicle industry remains robust.”
Contact the author at emily.jarvie@proactiveinvestors.com
Follow her on X, formerly known as Twitter, @emilyjjarvie