LMC Automotive and J.D. Power said in a report on Wednesday that they are predicting a drop in new vehicle sales in the U.S. for the month of April. Analysts predict retail sales will total just 1.1 million units, which is a 23.8% decrease in sales from April of 2021.
Altogether, retail and non-retail new vehicle sales are now expected to drop 21.5% year-over-year, totaling 1.2 million units.
The firms say the seasonally adjusted annualized rate for new car sales for the month will end up at 14.5 million units, which is down almost 4 million units year over year. They have also dropped their projection for global light vehicle sales to 81.7 million units for the year.
Inventory at dealerships remains low, reportedly totaling under 900,000 units, which will reportedly drastically impact sales volume. Supply chain constraints and parts shortages are continuing to plague automakers as well, with various COVID-19 lockdowns and the ongoing war in Ukraine hindering production even further.
The consulting firms also cited ongoing high demand and increasing interest rates that are causing prices to remain high. Wednesday’s report indicates the firms expect the average transaction price to reach $45,232, which is 18.7% higher than April of 2021. Interest rates are expected to rise to 4.61%, which will reportedly also heavily impact prices.
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