Page 27 - On The Move - 19.4

ew light-vehicle sales for July 2022 totaled a SAAR of 13.4 million units, up 2.5% from

NJune and down 8.9% from July 2021, when sales first started to be constrained by the
microchip shortage. As has been the case all year, sales continue to be limited by lack of Patrick Manzi

new-vehicle inventory. At the start of July, new-vehicle inventory on the ground and in transit Chief Economist
was 1.2 million units, and we don’t expect much change in that overall level by the end of the National Automobile

month. Dealers Association
800.557.6232
economics@nada.org

Sales of battery electric vehicles (BEVs) reached from higher new-vehicle transaction prices, rising For the rest of the year, new light-vehi-
5% of all new light-vehicle sales through July 2022— interest rates and lower discounts. July 2022’s av- cle sales will continue to be constrained
the highest market share for BEVs to date. Sales of erage transaction price, says J.D. Power, is expect- by lack of inventory, and that likely won’t
BEVs by franchised dealerships have accounted for ed to reach $45,869, just shy of the all-time record change much before year-end. Additional-
34% of all BEV sales this year. We expect that the set last month. Meanwhile, OEM average incentive ly, the Fed has increased the federal funds
share of BEVs sold by franchised dealers will con- spending per unit in July should total just $894, rate to a range of 2.25% - 2.5%, pushing
tinue to grow in coming years as more models are down 54.7% year over year and the third straight borrowing costs for new and used vehicles
introduced. month below $1,000. Those transaction prices likely higher. We think that the Fed will increase
sting a little less for consumers with a trade-in, as interest rates further at its three remaining
Another industry first also occurred in July—the av- demand for used vehicles remains high because of meetings this year. This will continue to put
erage monthly payment for a new vehicle reached the tight supply of new vehicles. In July 2022, ac- upward pressure on monthly payments for
an all-time high, topping $700. According to J.D. cording to J.D. Power, average trade-in equity re- new- and used-vehicle buyers, but we don’t
Power, the average monthly payment for a new ve- mains a near-record-high $10,083, up 37.4% from believe it will materially impact new-vehicle
hicle is on track to be $708—an increase of $81 dol- July 2021. demand. We forecast that new-vehicle sales
lars compared with July 2021 and resulting in part for all of 2022 will total 14.2 million units.

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