The US auto market is gearing up for a strong finish to 2023, with S&P Global Mobility predicting an impressive 11% year-over-year growth in light vehicle sales for October. This surge is attributed to a combination of factors, including potential incentives from automakers to boost consumer demand.
Chris Hopson, principal analyst at S&P Global Mobility, believes that automakers might offer additional support to consumers, particularly those facing pressure from high interest rates and persistent high vehicle prices. These factors have led to increased monthly payments, making new car purchases a significant financial burden for many.
Further fueling the optimism for October sales is the presence of two extra selling days compared to the same month last year. Additionally, the firm notes that inventory levels are currently high, providing ample choice for potential buyers.
EVs Lead the Charge
The report highlights the accelerating adoption of electric vehicles (EVs), with S&P expecting EV sales to exceed 9% of total auto sales in October. This growth is fueled by the anticipated launch of several new battery-electric vehicles (BEVs) in the final quarter, including the Polestar 3, Jeep Wagoneer S, and Volkswagen ID. Buzz.
The market has already witnessed the introduction of new EVs like the Chevrolet Equinox EV, and these launches are poised to push EV sales higher throughout the remainder of the year.
Tesla Aims for a Strong Finish
EV giant Tesla Inc. is also banking on a strong fourth quarter to boost its annual vehicle delivery volume beyond last year’s record. Tesla delivered 1,808,581 vehicles in 2022, and to surpass this number, the company needs to deliver at least 514,926 vehicles in the final three months of the year. While Tesla has yet to achieve a quarterly delivery volume exceeding 500,000, the company is aiming for a strong finish to cap off a successful year.
The continued growth of the EV market, coupled with potential incentives from automakers, suggests that the US auto sector is poised for a strong finish to 2023. With high inventory levels and rising consumer demand, the market is well-positioned to navigate ongoing economic challenges and maintain a positive trajectory.
