U.S. Vehicle Sales (March 2024)
Andrew Foran, Economist | 416-350-8927
Date Published: April 3, 2024
- Category:
- U.S.
- Data Commentary
- Commodities & Industry
U.S. vehicle sales cooled modestly in March
- U.S. vehicle sales fell 1.3% month-on-month (m/m) to 15.5 million (annualized) units in March – coming in below consensus expectations for an increase to 15.9 million units.
- Unadjusted sales volumes were 1.44 million units or 4.6% above year-ago levels. The average daily selling rate (DSR) was 53,260 – calculated over 27 days – up from March 2023's 50,926 daily rate.
- Passenger vehicle sales grew 1.3% year-on-year (y/y) while sales of light-trucks were up by 5.4% y/y. Light-trucks accounted for 80% of last month's sales, marginally higher than its share in March 2023.
Key Implications
- Light vehicles sales fell slightly to end the first quarter as affordability challenges weighed on the market. While the average transaction price (ATP) is 2.2% lower than it was a year-ago, income growth over the past four years has lagged ATP growth and significantly lagged growth in the average monthly payment for financed vehicles. This has concentrated demand in the non-luxury segment of the market, which accounted for most of the 2.7% y/y growth in sales for the first quarter of the year.
- We expect sales will continue to trend upward over the coming quarters as income gains and price moderation improve affordability, but elevated financing costs are expected to remain a headwind through 2024. As the Federal Reserve begins to lower borrowing costs in the second half of the year, this fading headwind is expected to support sales growth moving into 2025.
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