Light vehicle sales forecast: United States

Light vehicle sales in the United States could dip by 5.3 percent between 2021 and 2022. The U.S. auto industry is expected to sell about 14.2 million vehicles in a scenario that is based on data available through July 2022.

Auto demand is expected to rebound

U.S. light vehicle demand started to bounce back in 2021, but the automotive semiconductor shortage is expected to lead to production cuts and lower sales. In 2021, motorists in the U.S. bought some 15 million new automobiles and light trucks, up from around 14.5 million units in 2020. The industry experienced record sales between 2015 and 2018 when new light vehicle sales in the U.S. exceeded 17 million units.

Consumer confidence matters

Light vehicle demand picked up steam in the second half of 2020 after experiencing a sharp slump between March and May. The market defied predictions according to which new motor vehicle owners would not add new vehicles soon to the cars and light trucks already in their driveways. In 2019, the average price of a new light vehicle came to roughly 36,400 U.S. dollars, which is between 50 and 60 percent of the median household income in the United States. Consumers are typically less willing to make such a large investment when the economy slows down. In the second quarter of 2019, some 86 percent of new-vehicle buyers use financing schemes. In 2018, the average age of vehicles on U.S. roads was 11.7 years. However, this figure was even higher for households with an income level below 25,000 U.S. dollars per year. People living in such households reportedly held on to their vehicles for 13 years.