Sales of new vehicles in the U.S. are expected to increase slightly next year, as the industry normalizes from the coronavirus pandemic and other supply chain problems since 2020. Forecasters predict that auto sales in 2024 will increase by between 1% and 4% to roughly 15.6 million to 16.1 million vehicles sold. This anticipated growth in new car sales would be the highest level since 2019, when over 17 million new cars and trucks were sold domestically.
Key Factors Contributing to the Growth
- Improved inventory levels have driven incentives back into the market, resulting in lower prices for consumers.
- The electric vehicle market share is expected to rise slightly to 8% of total new vehicle sales in 2024, up from 6.9% in 2023.
- The automotive industry is transitioning from supply-side risks to a more uncertain macro-led demand environment.
Challenges and Headwinds
- Lower prices and rising incentives are expected to be headwinds for many automakers and dealers.
- New-vehicle inventory levels continue to improve, but prices remain stubbornly high and auto loan rates, while retreating from recent peaks, are still a challenge and keeping some buyers on the sidelines.
Forecasts from Leading Automotive Data Firms
- S&P Global Mobility expects U.S. sales to reach 15.9 million units in 2024, a 2% increase from the projected sales of 15.5 million units in 2023.
- GlobalData forecasts a nearly 4% rise in U.S. new vehicle sales to 16.1 million units.
- Edmunds predicts 15.7 million new cars and trucks to be sold in 2024, representing a 1% uptick from the estimated 15.5 million vehicles sold in 2023.
In conclusion, the U.S. automotive industry is expected to experience a slight increase in new car sales in 2024, marking the highest level since 2019. However, the industry will continue to face challenges such as high prices and inventory levels. As the market normalizes, automakers and dealers should be prepared for a more uncertain demand environment and adapt their strategies accordingly.