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Can U.S. Automakers Stage a Rebound From the Earlier Lows?
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U.S. automakers are putting up a great fight to rebound from the COVID-19 lows and other supply-chain issues that have been continuing since 2020. Although a lot of the supply-chain crisis has eased, sales are yet to gain pace.
However, sales picked up in 2023 and top automotive data firms expect 2024 to be a better year as demand shows signs of rebounding. According to a CNBC report, leading automotive data firms expect sales of new cars to pick up in the range of 1-4% or between 15.6 to 16.1 million units in 2024.
This would also mark the highest figures since 2019, when new car and truck sales totaled more than 17 million units domestically.
Last year wasn’t that bad in terms of sales for the leading automobile makers, including electric carmakers. General Motors Company (GM - Free Report) emerged as the top seller, beating Toyota Motor Corporation (TM - Free Report) , which so was the market leader in the United States.
U.S. new vehicle sales totaled 15.5 million in 2023, of which electric and hybrid vehicles comprised 17%, according to data from Wards Intelligence.
Sales have been the highest since 2019 and up 13.9 million units year over year, according to Cox Automotive.
GM, which is home to brands like Chevrolet, Cadillac, Buick and GMC, reported sales of 2.6 million units in 2023, up 14.1% year over year. General Motors’ jump came despite a workers’ strike that affected production for weeks. GM has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
On the other hand, Toyota sold 2.25 million units of new cars in 2023. TM’s figures were up 6.6% year over year.
Ford Motor Company (F - Free Report) reported a 7.1% jump in new car sales totaling 1.99 million units in 2023, up from 1.86 million in 2022. F said that sales were primarily driven by higher demand for pickup trucks and crossover SUVs.
Electric vehicles (EVs) were also high in demand in 2023 making up for a large portion of overall new vehicle sales. Toyota sold 657,327 EVs, including hybrid vehicles. TM’s electric vehicle sales rose 30.4% year over year in 2023, totaling 29.2% of overall U.S. sales.
GM sold 75,883 EVs last year. This saw EV sales surpassing 300,000 units for the first time in 2023, according to Cox Automotive.
However, Tesla, Inc. (TSLA - Free Report) , which was the market leader in EVs, lost some of the market share. TSLA, which accounted for 62% of the market share in the first quarter of 2023, ended the third quarter with roughly 50% of the market share.
The automobile industry suffered a lot in 2020 following the pandemic, when sales plummeted drastically. Following that, the industry suffered due to a supply-chain crisis that saw a crunch in the supply of semiconductors.
An acute supply crunch of semiconductors compelled several automakers to cut down production at their factories. Once the crisis eased, sky-high inflation started taking a toll on demand. Higher raw material costs slowed demand and impacted sales.
However, the crisis has eased a lot as inflation has cooled following the Federal Reserve’s monetary tightening policy. Also, the supply-chain crisis has eased, and hopes of interest rate cuts this year will make things easier for the industry.
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Can U.S. Automakers Stage a Rebound From the Earlier Lows?
U.S. automakers are putting up a great fight to rebound from the COVID-19 lows and other supply-chain issues that have been continuing since 2020. Although a lot of the supply-chain crisis has eased, sales are yet to gain pace.
However, sales picked up in 2023 and top automotive data firms expect 2024 to be a better year as demand shows signs of rebounding. According to a CNBC report, leading automotive data firms expect sales of new cars to pick up in the range of 1-4% or between 15.6 to 16.1 million units in 2024.
This would also mark the highest figures since 2019, when new car and truck sales totaled more than 17 million units domestically.
Last year wasn’t that bad in terms of sales for the leading automobile makers, including electric carmakers. General Motors Company (GM - Free Report) emerged as the top seller, beating Toyota Motor Corporation (TM - Free Report) , which so was the market leader in the United States.
U.S. new vehicle sales totaled 15.5 million in 2023, of which electric and hybrid vehicles comprised 17%, according to data from Wards Intelligence.
Sales have been the highest since 2019 and up 13.9 million units year over year, according to Cox Automotive.
GM, which is home to brands like Chevrolet, Cadillac, Buick and GMC, reported sales of 2.6 million units in 2023, up 14.1% year over year. General Motors’ jump came despite a workers’ strike that affected production for weeks. GM has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
On the other hand, Toyota sold 2.25 million units of new cars in 2023. TM’s figures were up 6.6% year over year.
Ford Motor Company (F - Free Report) reported a 7.1% jump in new car sales totaling 1.99 million units in 2023, up from 1.86 million in 2022. F said that sales were primarily driven by higher demand for pickup trucks and crossover SUVs.
Electric vehicles (EVs) were also high in demand in 2023 making up for a large portion of overall new vehicle sales. Toyota sold 657,327 EVs, including hybrid vehicles. TM’s electric vehicle sales rose 30.4% year over year in 2023, totaling 29.2% of overall U.S. sales.
GM sold 75,883 EVs last year. This saw EV sales surpassing 300,000 units for the first time in 2023, according to Cox Automotive.
However, Tesla, Inc. (TSLA - Free Report) , which was the market leader in EVs, lost some of the market share. TSLA, which accounted for 62% of the market share in the first quarter of 2023, ended the third quarter with roughly 50% of the market share.
The automobile industry suffered a lot in 2020 following the pandemic, when sales plummeted drastically. Following that, the industry suffered due to a supply-chain crisis that saw a crunch in the supply of semiconductors.
An acute supply crunch of semiconductors compelled several automakers to cut down production at their factories. Once the crisis eased, sky-high inflation started taking a toll on demand. Higher raw material costs slowed demand and impacted sales.
However, the crisis has eased a lot as inflation has cooled following the Federal Reserve’s monetary tightening policy. Also, the supply-chain crisis has eased, and hopes of interest rate cuts this year will make things easier for the industry.