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US New Car Sales Are Increasing Due To High Demand And Better Supply

US New Car Sales Are Increasing Due To High Demand And Better Supply
Leading international automakers saw an increase in new car sales in the United States during the second quarter as a result of improved supply and high demand, suggesting that the impact of rising interest rates has not yet been felt in a significant way.
After the pandemic affected the availability of semiconductor chips and other raw materials, vehicle production suffered, making it more difficult for manufacturers to satisfy the surge in demand for personal transportation.
As supply chain hiccups steadily disappear, businesses are increasingly scrambling to make up for the lost production.
"The jobs market has remained healthy, and consumers have found a way to buy new wheels," said Cox Automotive's Chief Economist Jonathan Smoke.
For the six-month period that concluded in June, Toyota Motor North America (TMNA) reported a 7.13% increase in U.S. sales to 568,962 units.
With an almost 19% increase in U.S. sales to a total of 691,978 units, including 15,652 electric cars (EV), General Motors, nevertheless, outperformed Toyota in the quarter.
When compared to competitors, the Japanese carmaker has had difficulty delivering enough cars and trucks to dealers on schedule.
According to David Christ, group vice president and general manager at TMNA, "we expect the second half of the year to be better in production and wholesale to our dealers than the first half" of the year. The supply chain is improving.
"The customer has been able to absorb the increase in transaction prices in the industry along with the rate increase," he added.
Earlier in the week, Stellantis subsidiary FCA US and Korean rival Hyundai Motor's American subsidiary both announced increases in overall auto sales of 6% and 14%, respectively.
The Inflation Reduction Act incentives and a pricing war started by market leader Tesla Inc., which delivered a record number of vehicles in the quarter, are driving up demand for EVs.
According to data issued by Wards Intelligence on Wednesday, new car sales in the United States as a whole totaled 1.37 million units in June, for an annual sales rate of roughly 15.7 million.

Christopher J. Mitchell

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