New-vehicle sales in the United States are up considerably this month compared to May 2022 but are expected to slightly trail April which had one extra selling day.
Data compiled by Cox Automotive reveals that sales this month will hit approximately 1.35 million. This represents a significant 20.3% spike from May 2022 when 1,121,835 new vehicles were sold in the U.S., in part because of poor inventory levels. However, sales will slightly trail April 2023 when 1,365,080 new vehicles were sold locally.
On the back of these results, the seasonally adjusted sales pace (SAAR) indicates the industry is on track to sell 14.9 million new vehicles in the U.S. this year. This is down from the 15.9 million level predicted after April’s sales figures were released but remain higher than the 13.75 million new vehicles that were sold in 2022.
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“New-vehicle sales will show strong gains this month over last year’s levels, and on the surface, this is a bit surprising,” Cox Automotive economist Charlie Chesbrough said. “Interest rates are substantially higher than a year ago, as are vehicle prices, and yet sales will increase year-over-year. The reason? Vehicle shoppers now have a much better chance of finding something that fits their needs. Pent-up demand, held back by limited product availability last year, is now being fulfilled as inventory levels improve around the country.”
It won’t be all sunshine and rainbows until the end of the year, however. Indeed, a slowdown in sales is expected in the second half of the year due to economic headwinds. It is also worth noting that May is traditionally one of the strongest months of any calendar year and that between 2015 and 2019, new vehicle sales in May averaged 1.57 million.
