NADA – Light Trucks Dominating Market

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Light trucks accounted for 79.8% of all light-vehicle sales in January 2022, with pickups and SUVs gaining market share while the popular crossover segment was flat year over year, according to the National Automobile Dealers Association. After surpassing $45,000 for the first time in December 2022, the average transaction price is expected to decrease slightly, but should still be a record for the month of January.

According to J.D. Power, the average transaction price for a new light vehicle in January 2022 is expected to reach $44,905. High transaction prices continue to be supported by strong demand and very low OEM discounting. Average incentive spending per unit in January 2022 should total just $1,319, down by $2,163 from January 2021, J.D. Power says. Continued high demand for used vehicles has increased consumers’ equity in their trades. J.D. Power expects the average consumer trade-in equity to be up by 88% year over year for January 2022.

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Automakers “continued to prioritize retail deliveries over fleet deliveries. After accounting for only 12.5% of light-vehicle sales in 2021, fleet sales are expected to be just 11% of sales in January. Inventory levels at the end of January 2022 are expected to show a slight increase compared with December 2021, but January sales were still held back by limited inventory. Severe winter storms at the end of January and the Omicron variant of COVID-19 also likely limited sales somewhat,” said Patrick Manzi, NADA Chief Economist.

Manzi also predicted that sales for the balance of 2022 will continue to be limited by vehicle production as automakers work to build back inventories amid the ongoing semiconductor microchip shortage. We forecast that light-vehicle sales will total 15.4 million units in 2022.