How much longer can new vehicle sales go up?

It’s been a strong run of year-over-year increases in the new vehicle sales market but one industry observer is concerned about how much longer the pace can continue as indicators point to an uncertain future.

June was the only month with a dip in the last 22 months — it’s dead even total in 2024 with 2023 being the only time there wasn’t growth.

But the bar has been fairly low to jump over — pandemic-related issues suppressed sales, so a return to normalcy in supply, demand and consumer confidence easily helped the market rebound.

While numbers rebounded above pandemic stats, they still sit below pre-pandemic data. And while August 2024 new vehicle sales were up compared to the same time last year — DesRosiers Automotive Consultants reported growth of 5.6 per cent, with an estimated 165,000 units sold — we’re still below the pre-pandemic average of over 180,000 units for August.

The seasonally adjusted annual rate (SAAR) for August 2024 reached 1.81 million units, the highest since the first quarter of 2024, when pent-up demand surged.

But will these good times last? Good times, compared to recent data, anyway. The consultancy isn’t quite sure.

Andrew King, DesRosiers’ managing partner, noted that sustaining significant percentage gains will be challenging.

“The final four months of 2023 saw improved inventory and an uptick in sales pace,” King said. “The SAAR consistently exceeded 1.8 million, setting tougher benchmarks for this fall.”

King also highlighted rising unemployment, declining GDP per capita, and high vehicle prices as factors contributing to the uncertain outlook for the coming months. Corporate performances varied widely in August, with some companies facing declines while others set new sales records.

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