Nov 23 (Reuters) – U.S. retail sales of new vehicles are expected to be relatively stable in November as high vehicle prices, coupled with rising interest rates, dampen demand, a report showed on Wednesday. JD Power-LMC Automotive industry consultants.
Consumers who were willing to shell out more money for cars in times of scarcity are now backing away from spending as rising loan payments put pressure on affordability.
The average monthly financing payment in November is expected to be $712, up 7.2% from November 2021, according to the report.
While demand, transaction prices and retailer earnings continue to show strength on the retail side, these metrics will show signs of moderating or declining, according to Thomas King, president of the data division and of analysis at JD Power.
King said he expects the trend seen in November to continue into 2023.
Retail sales of new vehicles this month are expected to reach 933,402 units, down 0.3% from November 2021, according to the report.
November’s seasonally-adjusted annual rate for total new-vehicle sales is expected to be 13.9 million units, up from 12.9 million units a year earlier, the report said.
The report, however, reported that new vehicle transaction prices continue to rise, but at a slower pace than earlier this year.
Total new vehicle sales in November, including retail and non-retail transactions, are expected to reach 1,102,300 units, a 5.6% increase from November 2021, according to the report.
Globally, the vehicle sales rate is expected to increase slightly in November to 86.5 million units, but volume growth from November 2021 is expected to be moderate at 8%.
“The potential for further lockdowns in China and a railroad strike in the United States add some risk to the outlook for November and December, but stocks are generally improving,” said Jeff Schuster, president of global forecasts at LMC. Automotive.
Reporting by Kannaki Deka in Bangalore
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