New-vehicle sales are expected to see a 12.1% increase in March compared to the same month last year, according to J.D. Power and GlobalData.
The total new-vehicle sales for March, including both retail and non-retail transactions, are forecasted to hit 1.5 million units. The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to reach 16.4 million units, up by 1.6 million units compared to March 2023.
New-vehicle retail sales for March are also expected to increase, forecasted to reach 1.2 million units, a 10.7% increase from March 2023.
Transaction prices are trending towards $44,186 -- down $1,648, or 3.6%, from March 2023, the largest decline in March ever, said Thomas King, president of the data and analytics division at J.D. Power.
"However, despite that, higher sales volumes mean consumers are on track to spend nearly $51 billion on new vehicles this month -- the highest ever for the month of March and 6.5% higher than March 2023," King added.
“Total retailer profit per unit -- which includes vehicles gross plus finance and insurance income -- is expected to be $2,487, down 31.9% from March 2023," King said. "Rising inventory is the primary factor behind the profit decline and fewer vehicles are selling above the manufacturer's suggested retail price (MSRP). Thus far in March, only 15.7% of new vehicles have been sold above MSRP, which is down from 31% in March 2023.”
For the quarter ending in March, new-vehicle retail sales are projected to reach 3.1 million units, a 4.5% increase from the same quarter last year, when adjusted for selling days.
“In conjunction with robust sales for Q1, elevated transaction prices mean that consumers are expected to spend more than $129 billion buying new vehicles, an all-time Q1 record," said . "However, while the sales and expenditure performance are impressive, it is coming at the expense of reduced retailer and manufacturer profitability as inventories of unsold vehicles rise and competitive pressures intensify.”
Retail inventory levels are expected to finish around 1.7 million units, a 4.2% increase from February 2024 and a 39.3% increase from March 2023.
Fleet mix is projected at 19.7%, up 1 percentage point from March 2023 and up 18.4% on a volume basis, as several manufacturers increase their focus on fleet sales as a mechanism to address excess inventory.
