Overall auto sales post a solid second quarter finish as CU struggles
Analysts said they expected a strong end this week for second-quarter auto sales, but new auto loans from credit unions are still in reverse.
Edmunds said Tuesday that his analysts expect new vehicle sales to remain strong in the second quarter. The Santa Monica, Calif.-Based car buying analytics firm forecast 4.5 million new cars would be sold in the second quarter, up 14.8% from the first quarter and 51.6% % compared to the second quarter of 2020.
Second-quarter new vehicle sales got off to a flying start in April thanks to a combination of a faster-than-expected vaccine rollout and many Americans eager to jump into a new vehicle and on the road to some semblance of normal life. “Jessica Caldwell, executive director of ideas for Edmunds, said.
“Unfortunately, the chipset and inventory shortages really peaked and outpaced supply in June,” Caldwell said. “It’s not a problem that’s going to go away anytime soon, but the silver lining for automakers and dealers is that consumer demand continues to be high and buyers are clearly willing to pay inflated prices for them. vehicles they want. “
Cox Automotive Group forecast on Monday that new cars will sell at a seasonally adjusted annual rate (SAAR) of 16.4 million vehicles in June, up 23.9% from the previous year, and down from the previous year. at the “robust pace of May 17.0 million but up from COVID- of June 2020-19 inflicted a pace of 13.0 million,” according to the report from data analytics firm Irvine, in California.
Used cars retailed at a SAAR of 21.3 million in June, down from a high of 23.9 million in April and 21.9 million in May. Used car sales, which fell 6.2% last year to 19.7 million, are expected to rise 9.1% this year to 21.5 million.
Cox Automotive found that the stock of new cars was historically low at the start of June, 43% lower than levels for the same period in 2020 and 54% lower than in early June 2019. As a result, the incentive New vehicle average fell to its lowest level in nearly 10 years.
“While the volume of new vehicle sales in the first half of 2021 is healthy – and comparable to that of the first half of 2019 – the market could be stronger without the lack of available supply,” said Charlie Chesbrough, senior economist at Cox Automotive. . “Concerns about the supply situation really cannot be overstated as we are in untested territory for the market.”
Meanwhile, the CUNA Mutual Group credit union trends report released on Monday showed that credit unions held $ 138.2 billion in new car loans as of April 30, down 5.6% from to the previous year. Used car balances rose 6.4% to $ 246 billion. Non-auto loans (mainly mortgages) increased 6.6% to $ 820.4 billion.
New car balances also fell 0.2% from March 31, marking the fifth consecutive month of declines. Used car balances rose 0.6% from March, allowing total auto loan balances to rise 0.3% to $ 384.2 billion, breaking a four-month streak of drop.
“We should have more auto loans, but this is limited to some extent by some of these supply chain challenges,” CUNA senior economist Jordan van Rijn said in his economic update video. published June 24.
“Demand remains very high for vehicles,” he said. “We see a lot of pent-up demands. Many people choose to go on vacation in their vehicle rather than other means of transportation.
But van Rijn said vehicle production continues to be constrained by the shortage of microchips, reducing the number of vehicles on batches and pushing up the prices of not only new cars, but used cars as well.