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U.S. auto gross sales forecast to plummet in third quarter as chip scarcity plagues {industry}

Honda Motor Co. autos at an AutoNation automotive dealership in Fremont, California, U.S., on Monday, Feb. 15, 2021. AutoNation Inc. is scheduled to launch earnings figures on February 16.

David Paul Morris | Bloomberg | Getty Pictures

DETROIT – U.S. auto gross sales are anticipated to nose-dive in September, driving purchases of recent autos down within the third quarter by at the very least 13% because the chip scarcity continues to disrupt manufacturing, new {industry} estimates present.

Forecasts from Cox Automotive, Edmunds and J.D. Energy/LMC Automotive predict automobile gross sales from July by September had been lower than 3.4 million, down between 13% and 14% from the identical time final 12 months when volumes had been depressed because of the coronavirus pandemic.

The extreme decline, together with an anticipated 24% to 26% fall in September, is because of the ongoing scarcity of semiconductor chips for brand spanking new autos.

The elements scarcity has precipitated automakers to sporadically shutter vegetation for weeks, if not months. The shortage of manufacturing mixed with robust client demand has precipitated automobile inventories to plummet to file lows.

“The complete U.S. auto {industry} — together with the Asian producers, which had been doing a bit higher than their home counterparts till not too long ago — is in an extremely risky place proper now and we’re seeing inflated retail costs throughout the board,” stated Jessica Caldwell, government director of insights at Edmunds.

The stock shortages have worsened all year long. Forecasters expects only one million autos to be offered in September, which Cox Automotive studies could be among the many lowest quantity previously decade.

The gross sales tempo within the U.S. market has fallen each month since reaching a peak of 18.3 million in April. It is anticipated to be 12.1 million to 12.2 million in September.

Cox analysts predict automobile provide will enhance mildly within the fourth quarter, and proceed to enhance all through 2022, however will not return to “regular” till 2023 – if ever. Automakers have promised to maintain leaner inventories sooner or later to spice up automobile income and costs, which have been at file ranges.

J.D. Energy expects common transaction costs will attain a file of $42,802 in September, marking a fourth consecutive month over $40,000.

“The mismatch between robust client demand and constrained stock is resulting in larger automobile costs,” stated Thomas King, president of the information and analytics division at J.D. Energy.

Nearly all of automakers who promote autos within the U.S. are scheduled to report third-quarter gross sales on Friday. Ford Motor is anticipated to report gross sales on Monday.

Edmunds expects Normal Motors and Ford to have the most important third-quarter gross sales declines of 31.5% and 29.3%, respectively. An outlier for the quarter is anticipated to be Hyundai/Kia, which Edmunds forecasts shall be up by 10.1%. Cox Automotive additionally expects Tesla’s third-quarter gross sales to have risen by about 26%.

https://www.cnbc.com/2021/09/30/us-auto-sales-forecast-to-plummet-in-third-quarter-as-chip-shortage-plagues-industry.html | U.S. auto gross sales forecast to plummet in third quarter as chip scarcity plagues {industry}

DevanCole

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