DSMA’s latest Automotive Intelligence report, its quarterly update for the second quarter of 2023, found that vehicle production and consumer demand helped enable strong sales growth for the first half of the year.
Year-to-date light-vehicle sales volumes were up 7.6% (or 813,000 units) compared to the same period last year, although sales units still lagged pre-pandemic levels, which were at 1.04 million in 2018.
“Volume growth complemented by further increases in transaction prices, which grew 3% for the first half of 2023 despite decreased OEM incentives and declining dealer gross margins,” said DSMA in its update. “Overall industry margins remain very healthy compared to historical trends.”
General Motors benefited from a strong performance in Q2, claiming the top performance spot for this period thanks to an increased market share of 15.7% year-over-year. They led the market with a 2023 year-to-date unit sales figure surpassing 127,000.
Buick, too, did well; its sales increased 143% while Chevrolet, Cadillac, and GMC also enjoyed significant growth.
DSMA highlighted in its update that goodwill multiples declined industry-wide due largely to higher rates and potential future increases. Average interest rates for new vehicle loans is expected to jump 194 basis points YoY, to 7.0%.
“The rate of delinquencies is surpassing the surge of the heating interest rate environment. The current inflation and interest rates has some consumers continuing to raise affordability concerns,” said DSMA. “Elevated rates have also increased challenges in M&A transactions as small- and medium-sized buyers face challenges in securing transaction financing.”
The fun report, including DSMA’s outlook and data charts, is available here.
