US auto sales boosted by price cuts in 2023

US auto sales boosted by price cuts in 2023

Industry experts estimate around 15.5 million vehicles were delivered in the United States in 2023
Industry experts estimate around 15.5 million vehicles were delivered in the United States in 2023. Photo: JEFF KOWALSKY / AFP/File
Source: AFP

US vehicle sales got a boost from strong demand in 2023, due in part to attractive offers by automakers and dealers in the face of high interest rates and stubborn inflation.

Industry experts estimate that around 15.5 million vehicles were delivered in the country last year, marking an increase of almost 13 percent from 2022.

"Auto sales ended up being much stronger than most expected in 2023," said Garrett Nelson, senior equity analyst at CFRA Research.

"We're getting closer to pre-covid levels," he told AFP. Sales exceeded 17 million vehicles annually over the 2015-2019 period.

Nelson expects sales to rise by three percent in 2024, to around 16 million units.

Automotive research firm Edmunds is less optimistic, however, expecting just a one percent rise in sales to 15.7 million units.

PAY ATTENTION: Share your outstanding story with our editors! Please reach us through info@corp.legit.ng!

Read also

German car sales up in 2023 but electric models lose ground

According to Nelson, sales have benefited from improved supply chains and more inventory at dealers. There was also greater choice for buyers, who took advantage of promotions, price cuts and federal subsidies.

Electric vehicle maker Tesla, for example, was among those to lower prices.

"Prices overall were down about two to three percent, much more than that for electric vehicles, but they're still at elevated levels," Nelson said.

Holding on to its crown as the top-selling automaker in the United States last year was General Motors, which claimed a 16.3 percent market share and reported 2.6 million in vehicle sales.

Affordable prices

GM "had great success" with affordable SUVs, said its North America president Marissa West. This enabled it to sell more than one million SUVs in a year for the first time.

Shoppers are "seeking options on the affordable side of the new vehicle market," according to Edmunds.

Read also

Asian markets extend new year retreat after Fed minutes

It added that vehicles below $50,000 are sold out within an average of 30 days, compared with 47 days for more expensive models.

Meanwhile, the share of electric vehicles in the market should continue rising, from 6.9 percent in 2023 to eight percent of all sales in 2024, Edmunds said.

Tesla, which does not detail its sales by country, delivered 1.8 million vehicles globally last year -- a 38 percent jump from 2022.

While it retained its number one position internationally for the full year, it was surpassed in the fourth quarter by Chinese manufacturer BYD.

Even as automakers lauded the performance of their electric models, the pace of sales has fallen short of expectations, prompting some to review their projects.

GM, for one, has delayed the transition of its Orion plant into an EV truck factory by a year to 2025.

But overall, the company logged EV sales of 75,883 units, a 93 percent jump.

Read also

BYD: Chinese electric vehicle giant that has overtaken Tesla on sales

Ford, whose US sales rose to almost two million vehicles in 2023, also noted "accelerating sales of its electric and hybrid vehicles to new records."

Alongside Stellantis, which delivered 1.5 million vehicles last year, GM and Ford form the "Big Three" automakers hit by a six-week strike ending in late October.

The end of the labor action came with new collective agreements involving better wages and other benefits.

"Their margins are going to be under pressure from those higher labor costs and the new labor deals," said Nelson.

Among other major players is Japanese automaker Toyota, which reported US sales of 2.2 million vehicles last year, including over 657,000 electrified vehicles.

The group has announced investments of nearly $16 billion in the United States, including almost $14 billion for a major battery plant in North Carolina.

Source: AFP

Authors:
AFP avatar

AFP AFP text, photo, graphic, audio or video material shall not be published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP news material may not be stored in whole or in part in a computer or otherwise except for personal and non-commercial use. AFP will not be held liable for any delays, inaccuracies, errors or omissions in any AFP news material or in transmission or delivery of all or any part thereof or for any damages whatsoever. As a newswire service, AFP does not obtain releases from subjects, individuals, groups or entities contained in its photographs, videos, graphics or quoted in its texts. Further, no clearance is obtained from the owners of any trademarks or copyrighted materials whose marks and materials are included in AFP material. Therefore you will be solely responsible for obtaining any and all necessary releases from whatever individuals and/or entities necessary for any uses of AFP material.