Who won chips and who didn’t: Hyundai-Kia sales near all-time high in 2022 Honda sales collapsed.
To wolf richter for wolf street.
When it comes to new car sales in the US, good years are bad and bad years are terrible.
In 2022, total new vehicle deliveries to retail customers and fleets (dominated by rental fleets) will drop 8% from an already dire 2021 to 13.7 million units, below shipments in 1977. A 16.4% decrease from its peak in 2016. , down 20.8% from the previous peak in 2000.
In this environment of stagnating or plummeting sales, the way automakers have increased their dollar earnings for decades is to sell more expensive cars and sell them with smarter, more advanced, better models. A better performing, more efficient, better equipped and safer vehicle – that is, even the base F-150 pickup truck has a 10-speed automatic transmission.
But already many years ago, gentrification and ever-increasing prices began to contribute to stagnation. Because there seems to be a shortage of upscale Americans.
But 2022 has been a very special year. Chips were in short supply, shifting demand for fuel-efficient vehicles.
The semiconductor shortage began to worsen in late 2020, worsened in 2021, dragged into 2022, and continues to a lesser extent.
In such an environment, if automakers could obtain the semiconductors they needed, they could manufacture and sell cars, and sales were brisk. It’s nice to have a good relationship with the Korean semiconductor maker, with Toyota saying he’ll be in September 2021, Hyundai and Kia he’ll be in 2021 and he’ll be in 2022. And when he only one of the thousands of semiconductors included in one model is used up, they can no longer manufacture this model, they have nothing to sell, and the dealer’s inventory is depleted. , sales of Honda and Toyota plummeted in 2022. American automakers have always had problems.
In addition, fueled by rising gas prices in early 2022, demand for cars suddenly shifted to fuel-efficient cars, especially small and midsize cars and compact SUVs, which incumbent automakers were unable to produce. Shifted to EV. His supply chains and production were completely unprepared for this change.
As such, inventory shortages have disappeared from dealer lots in 2021, shifting from pickup trucks and SUVs, which are currently in ample supply, to 2022. In 2022 there will be no more fuel efficient cars in dealerships..
Data from Cox Automotive showed that overall inventory reached 1.64 million units through November, still down 54% from November 2019.
Shortage drives prices up.
Classically, the MSRP is set before a new model year vehicle arrives at the dealer and remains unchanged for the entire model year thereafter. Automakers and dealers typically stack discounts, dealer incentives, and customer rebates to drive sales (with the exception of direct-to-sale Tesla, which changes prices on its website from time to time).
But in 2021 and 2022, those discounts, dealer incentives and customer rebates are gone, allowing dealers to sell vehicles thousands of dollars above MSRP. Normal time.
Additionally, automakers, who could only build a limited number of vehicles due to chip shortages, prioritized the most expensive models, driving up prices. And so I ended up writing this crazy article: $1,768/month, down $10,407, 5% p.a. Ford pickup? Q3 new car finance update.
As a result, the average transaction price after applying all incentives and additional stickers jumped 33% over three years, from $34,900 in December 2019 to $46,400 in December 2022, according to JD Power. That price jump has now leveled off.
The graph shows the average transaction price for June and December each year. The green line connects his December. Also note that the usual seasonality (lower average trading prices mid-year) has completely disappeared recently.
Wild Ride from America’s 7 largest automakers.
Note: The first four charts (the big four) are on the same scale to show their relative sales. His three remaining major automakers haven’t sold well enough to appear on these charts, and each has its own scale.
general motors: Sales increased by 2.5% year-on-year to 2.274 million units. But this is down 26% from its recent peak in 2015, after plummeting 2020 and 2021, and after his four years of respective declines in sales prior to that.
Toyota: Through the first half of 2021, Toyota had an abundant supply of semiconductors thanks to special deals with suppliers. But then that too ran out and by September 2021 we started running out of vehicles. Nonetheless, his strength through the first three quarters of 2021 was enough to make him No. 1 in the United States for the first time in history.
In 2022, after a series of production cuts, inventories ran out and sales plunged 9.6% to 2.11 million units, down 16% from the recent peak in 2015.
ford: Sales fell by a further 2.2% year-on-year, marking the seventh consecutive year-on-year decline. Sales have plummeted 28% since his recent peak in 2015.
Stella (FCA US): Sales fell 13% year-over-year, down 32% from its recent peak in 2015.
The charts below for the remaining three major US automakers are each on their own scale.
Hyundai-Kia: Anyone who can get chips can build a vehicle and sell something. It helps that other South Korean companies are world powerhouses in semiconductor production. As such, Hyundai Kia’s total sales will hit a record high in 2021, and in 2022 he will drop 1.5% from that record to 1.42 million units.
Honda: Like Toyota, 2021 was reasonably strong, but from the second half of 2021 to 2022, it will be hit by a shortage of semiconductors, which will bottom out, and sales will fall 33% year-on-year. 40% decrease from 2017 peak:
Nissan: Sales fell 25% year-over-year to 729,000, down 54% from the 2017 peak. The company was already in big trouble before the pandemic, with sales falling 16% in his two years to 2019 from its peak in 2017. The pandemic and chip shortages have taken a further hit.
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