January SAAR new light-vehicle sales hit 15 million units, down 10.4% from 2021, with light trucks 79.8% of sales as limited inventory, winter storms, COVID affect sales; 2022 sales to be limited as microchip shortage to affect vehicle production: NADA

Sample article from our Automobile Industry

February 3, 2022 (press release) –

New light-vehicle sales in January 2022 recorded a seven-month-high SAAR.

By Patrick Manzi, NADA Chief Economist

New light-vehicle sales in January 2022 recorded a seven-month-high SAAR. January’s SAAR reached 15 million units, an increase of 20% from December 2021, but down by 10.4% from January 2021. While this was an improvement in SAAR from December, raw volume in January was the lowest since April 2020.

OEMs 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.

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. After topping $45,000 for the first time in December 2022, the average transaction price is expected to cool 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.

Sales throughout 2022 will continue to be limited by vehicle production as OEMs 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.

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