Foundation Takeaway: New Vehicles sales are projected to reach 1,136,800 units, a 0.6% gain from August 2021, and a 0.8% increase from July 2022 (August usually outsells July by 2-4%). The industry continues to deal with inventory constraints as August 2022 is on track to be the 10th consecutive month that inventory closes below 1M units and Days’ supply remains in the 20-30s. 55% of vehicles will be sold within 10 days of arriving at a dealership.
Foundation Takeaway: Released Sept. 8 2022 Experian provides a concrete look at 2022 sales through Q2 2022. Slide 18 shows that a record 99 million vehicles are in the ‘sweet spot’ for service repairs — 35% of all vehicles on the road. As sales slide service will continue to be a important lever to drive business and loyalty. Slide 28 new registrations were down 21% YoY through Q2 2022 while used is down 14.3% while driven by inventory also a sign of slowing vehicle sales. Slide 31 Tesla passes BMW in new vehicle share of sales. Slide 34 GenZ passes Silent generation in new vehicle sales but is still only 7% of total new vehicle sales. Slide 48 electric vehicles reach 4.5% of total new vehicle registrations.
Foundation Takeaway: Inventory constraints continue to grip the auto industry and the impact on auto shoppers is apparent with brand loyalty dropping below 50% for the first time in eight years. Brand loyalty drops dealer loyalty. Dealers being present to capture demand (search) on the inventory currently on lot has never been more important — a core strategy we follow at Foundation. With loyalty top of mind we are also reading Meta’s 3 Ways Auto Brands Can Drive Long-Term Loyalty.
Foundation Takeaway: A record number of dealership were sold in the 1h of 2022 of 225, 3% more than last years record pace YoY. Demand seems likely to exceed supply for the foreseeable until potentially 2025. In their report on page 7 an interesting chart of Consumer Sentiment vs. SAAR. Consumer Sentiment is hitting an all-time low which doesn’t bode well for future vehicle demand.
Foundation Takeaway: ~5% of new vehicle sales are electrics and expected to grow to 35% by 2030. California already commands 42% of all new electric vehicle sales. With 158 new electric models launching by 2025 it is clear to see where the market is progressing towards and California is here to accelerate it even more. Check out the EV analysis section in the slides to the left.
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