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Vehicle sales slip in July due to lack of supply
Total vehicle sales fell from 15.4 million annualized units to 14.8 million annualized units in July, with monthly sales levels up 0.8 percent year over year. NAFCU Chief Economist and Vice President of Research Curt Long analyzed the report in a new Macro Data Flash report.
"Vehicle sales continued their slide in July, driven primarily by lack of supply," said Long. "With an economy in recovery, the macroeconomic factors exist for very strong sales, but unfortunately supply is not cooperating.
"Dealers are being stingier with incentives and manufacturers are using their limited semiconductor supply on the most profitable vehicles," Long added. "The shortage is so acute that U.S. auto production fell to its lowest level in 30 years."
Car sales declined this month from 3.6 million annualized units to 3.5 million annualized units while light truck sales slipped to 11.3 million annualized units.
Total sales are down 4.1 percent from July 2019 and are at their lowest rate since August 2012. Auto sales have spent 16 of the last 17 months under 4 million annualized units after spending 50 years above that level.
"Unmet demand in the new vehicle market has propelled used car prices upward at a rapid pace in 2021, but the latest data from Manheim suggests some modest softening over the past two months," concluded Long. "Experts anticipate the production snags will persist into early 2022, which will continue to weigh on sales."
For more up-to-date economic insights from NAFCU's award-winning research team, view NAFCU's Macro Data Flash reports.