Some Notable Numbers

Let’s face it: vehicle sales in the first half of 2022 were not great in terms of volume.

What’s more, they weren’t great for customers who were looking for something affordable—according to Kelley Blue Book, the average transaction price for a new vehicle was a record $48,043.

They were great for OEMs and dealers, because higher prices mean bigger profits.

Be that as it may, it is interesting to look at how the leading OEMs made out in terms of one another when it came to sales.

In first place there is General Motors, which sold 1,087,761 vehicles. Based on that, here is the sales delta between pairs of subsequent companies (i.e., how many more the first named company sold than the company that follows it in sales ranking):

  • GM to Toyota:                  42,064
  • Toyota to Ford:                135,965
  • Ford to Stellantis:            95,900
  • Stellantis to Hyundai:       110,867
  • Hyundai to Honda:           196,668
  • Honda to Nissan:             73,683
  • Nissan to Volkswagen:      173,162

The gap between Toyota and Ford is surprising. And the gap between Ford and GM is even more surprising: 178,029.

Hyundai (as in the Group, meaning Kia, too) is certainly coming on strong. And Honda seems to be fizzling.

Realize that all of these companies are dealing with supply chain snafus and chip shortages, so it is a matter of (1) those who did a better job of managing their way through adversity and (2) a range of products (generally large SUVs and light-duty pickups) that consumers were interesting in acquiring.

Buying Electric Pickups

People buy a lot of trucks. According to NADA, in 2021 U.S. light truck sales (admittedly not all vehicles with cargo boxes on the back, as SUVs make it into this space) accounted for 77.6% of all light-duty vehicles moved off of dealer lots.

With the transition toward electrification, OEMs have undoubtedly taken this into account. So whether it is a traditional OEM like Ford and the now-in-volume-production F-150 Lightning or a startup like Rivian and its R1T, electric pickups are rolling out and there are more to come.

Cox Automotive has done some interesting research on potential purchasers of electric pickups.

Looking at those who currently own gas-powered trucks, they found that when it comes to what they are likely to buy next, 50% said they’d stick with gas-powered trucks. 37% said electrified (hybrids or full battery electric). And 14% will consider both.

What’s good news for the OEMs is that only 36% of buyers under age 35 would consider just gas-power, so the future looks better because the OEMs are putting a big bet on the future. 53% of those older than 35 say they’ll be sticking with gasoline. The first group will be buying more vehicles than the latter.

One finding puts the why-buy into perspective for pickups.

While some might imagine that the trucks are mainly for vocational use, turns out that only 12% of those who are considering an electrified for truck say they are doing so because they need it for work.

And 45% say they need it for their hobbies/interests.

A Bright Aspect of the U.K.’s Dour March Sales

Although passenger vehicle sales in the U.K. were down 14.3% in March compared to March 2021 at a total 243,479 units.

The U.S. sales were, according to LMC Automotive, on the order of 1.25 million units in March, the automotive consulting firm notes that compared to March 2021 that is a decrease of 22%, so the Brits are better on that score.

What is most notable about the U.K. vehicle registration numbers, as reported by SMMT: Battery electric vehicle sales were 39,315 units, or 16.1% of all vehicles sold. That is a 78.7% increase over the number of EVs sold there in March ’21.

Other categories:

Diesel:                    13,736 units           -55.2% (from March ’21)

Petrol:                     102,349                  -25.6%

MHEV diesel:          11,569                    -50.3%

MHEV petrol:          32,716                    4.0%

PHEV:                     16,037                    -7.5%

HEV:                       27,737                    28.4%

In other words, only EVs, mild gasoline hybrids and hybrids saw an increase. Those three categories of vehicles represent 40.9% of the total market in March ’22.

Things are certainly changing in the U.K.

The best-selling vehicle in the U.K. in March? The Tesla Model Y. And that’s of all powertrains. Number 2? The Tesla Model 3.

Enough said.

Why You May Not Be Getting That New Vehicle Anytime Soon

“The preliminary assessment from S&P Global Mobility for global auto production and sales levels continues to develop, but the current geopolitical events put pressure on an already delicate auto industry situation. Given additional uncertainty surrounding some important raw materials used in the production of semiconductors out of Ukraine and Russia, an initial assessment results in an assumption that several semiconductor plants will be forced to run intermittently at suboptimal speeds between the third quarter of 2022 and the second quarter of 2023, which in turn results in a further downgrade of global light vehicle production levels.  Lower production levels will create an even more untenable new vehicle inventory situation resulting in a downgrade to US light vehicle sales expectations.  As reflected in the S&P Global Mobility March 2022 forecast release, our initial impact removes approximately 250,000 units from our CY2022 US sales expectation and just over 300,000 units from our CY2023 projection, resulting in expected annual volume totals of 15.2M and 16.6M respectively.”– Chris Hopson, manager, North American light vehicle forecast, S&P Global Mobility

Maybe next year. . .

LMC’s Schuster on the State of the Industry

By Gary S. Vasilash

There is pent-up demand. People are driving more. But. . .there are not enough vehicles out there to fulfill demand. There is that chip shortage accounting for the vast majority of vehicles not being on lots (an impact on the order of 85-90% of missing vehicles). According to Jeff Schuster, president of Global Forecasting, LMC Automotive, inventories will improve. Which will help that situation. Somewhat.

Because there is that other big issue that those who are in the market for a new vehicle: cost. (Latest average transaction price according to KBB: $46,404).

Schuster suggests that if prices stay elevated—and for the foreseeable future there doesn’t seem to be any driver for why prices would decrease—there are going to be plenty of people who are sitting on the sidelines, not going out and buying new vehicles.

So on the one hand, while OEMs and dealers are making profits by producing and selling high-ticket vehicles rather than more conventional family haulers (i.e., if there is a limited number of chips, then they get installed in the more-profitable vehicles); on the other hand there are people who can’t afford to buy something that has a price tag more analogous to luxury vehicles, so they are likely to figure out the ways and means to get transportation at a more affordable rate.

But here’s something to consider: What if an OEM decides that there could be an opportunity to sell entry-level vehicles, vehicles that have slim margins, but vehicles that could sell in large numbers? Schuster says this is not entirely outside the realm of possibility.

And what if said OEM happens to be one that isn’t particularly familiar to U.S. buyers: as in a Chinese company coming in with low-end vehicles? Schuster says that this is a possibility—yes, even despite the currently existing 27.5% tariff that is tagged onto vehicles imported to the U.S. from China. Apparently there is a lot of capacity to build vehicles in China, and so there could be an interest in keeping those plants running.

EVs? There will be more of them. (Which, Schuster notes, is something that isn’t going to reduce the price paid by consumers as they tend to be more expensive than comparable ICE-powered vehicles.)

Tesla? Yes, it will continue to grow. Schuster says that while it is ahead of other global automakers in terms of tech—a cycle or two ahead of others—LMC analysts anticipate that it will begin to lose some of its dominance in the EV space because of the other OEMs entering it.

Jeff Schuster has a whole lot more of interest to say about the state of the auto market today and in the near future on this edition of “Autoline After Hours.” He talks with “Autoline’s” John McElroy, Reuters’ Global Automotive Correspondent and me.

And you can see it here.

Vehicle Types: More of the Same

By Gary S. Vasilash

According to AutoForecast Solutions, the top global vehicle types in 2021 were:

  • Small CUV:  24%
  • B:                12%
  • C:                10%
  • Mid CUV:     10%
  • D:                10%
  • Minivan:      5%
  • Large P/U:   5%
  • Others:        24%

The firm has extrapolated what it sees coming in 2028:

  • Small CUV:  28%
  • B:                11%
  • C:                10%
  • Mid CUV:     10%
  • D:                9%
  • Minivan:      5%
  • Large P/U:   5%
  • Others:        22%

In other words, a few more small CUVs and almost everything else just the same.

One could argue the future is now.

EV Upstarts

By Gary S. Vasilash

The number of electric vehicles being offered–or announced that they’re on their way–by traditional OEMs is increasing with a beat that it reminiscent of that person in the apartment above yours tapping his or her giant foot: BAM! BAM! BAM!

And in addition, there is the influx of new manufacturers, which are seeing the opportunity to get into automotive manufacturing, something that, say, 10 years ago, was about as appealing as a session at an endodontist who had just run out of Novocain.

According to LMC Automotive, the startup EV brands in the U.S. are going to have nearly 40 models on offer in the U.S.

(Image: LMC)

However, LMC reckons that few of the new brands are likely to have sales of more than 50,000 units per year.

That said, a sufficient number of 50K-selling OEMs means that the sales are likely to be taken from the traditional OEMs.

However, LMC thinks that it is going to be costly for the upstarts that build factories. The firm calculates that the capacity utilization of a given plant is going to be on the order of 30%, which is about 60% less than it really ought to be. (I.e., 30% capacity utilization means that 70% of the personnel and equipment are not making vehicles, which is the whole point of their being there.)

Volkswagen Group 2021 EV Numbers

By Gary S. Vasilash

Volkswagen Group—Volkswagen, Volkswagen Commercial Vehicles, Škoda, SEAT, CUPRA, Audi, Lamborghini, Bentley, Ducati, Porsche—announced its combined electric vehicle sales on a global basis for 2021.

The company delivered 452,900 battery electric vehicles in ’21, a 95.5% increase over ’20 numbers, when it delivered 231,600 units.

The vehicles that are the biggest contributors:

  • Volkswagen ID.4: 119,600 units
  • Volkswagen ID.3: 75,500 units
  • Audi e-tron:  49,200 units
  • ŠKODA Enyaq iV:  44,700 units
  • Volkswagen e-up!: 41,400 units
  • Porsche Taycan:  41,300 units

Of that, the ID.3, Enyaq iV and e-up! are not available in the U.S. market. That represents a total of a non-trivial 161,600 units.

Here’s something to consider about that 452,900 EVs:

The Group delivered a total 8,882,000 vehicles in 2021.

Put the numbers in context.

Vans Save Merc’s 2021

By Gary S. Vasilash

When you think “Mercedes Benz,” presumably it is in the context of something like the S-Class, a swanky motor vehicle.

And you wouldn’t be wrong, because a new S-Class was launched in 2021 and not only is it swanky, but it is chockfull of so much tech that it is probably like most PCs that people own: there are so many possible programs that one is unlikely to ever use all of them or even a few of them to their full capabilities.

And people clearly find it appealing because S-Class sales in 2021 were up 66.3% in 2021 over 2020, or 14,282 units.

Actually, in the car space, that was Mercedes top performer in 2021. Although it moved more C-Class cars, 30,815, on a percentage basis the C-Class was up only 17.2% from the previous year.

And while there were more E-Class vehicles sold than S-Classes—20,947—on a percentage basis that is down 22.7%.

In fact, there were a lot of minus signs in Mercedes’ 2021 results.

Fortunately for it, there are the “G” vehicles, crossovers, where, not surprisingly, the action was. For example, the GLE, with sales of 65,074 had a stellar performance, as it was up 35.1% compared with 2020. (The GLE has a variety of variants, so that undoubtedly was beneficial for those going into the showroom.)

Mercedes-AMG GLE 63S Coupe (Image: Mercedes-Benz)

But the bottom line for the Mercedes-Benz passenger vehicles shows an increase of just 0.4% compared to 2020. Yes, positive territory. But then, 0.4%.

However, Mercedes has something else, something that you probably don’t think about, something not stylish and swanky:


Things like the Sprinter and Metris Vans.

Van sales in 2021 were up 4.8% compared with 2020. A total of 53,472 units.

So all-in, Mercedes was up 1.1%.

Arguably, thanks to those vans.

Not A December to Remember: At Least If You’re Shopping

By Gary S. Vasilash

Cox Automotive reports that there are two things going on in the new vehicle market right now that certainly aren’t particularly beneficial if you’re looking for something new to put in your driveway.

On the one hand, average transaction prices (ATPs) are continuing to climb. In November the ATP was $46,329, a record, and while the December number has yet to be calculated, Cox notes, “A new record in December would not be surprising.”

Then on the other hand, there are incentive programs, which are continuing to disappear.

Cox points out that in 2019 new-vehicle incentive programs reached an all-time high. This year, incentive programs have decreased month after month such that in the fourth quarter it was at the lowest point in five years.

Of course, all of this matters only if vehicles can be found.

Charlie Chesbrough, senior economist at Cox, says, “While sales in the first half of 2021 were relatively strong, the industry ran out of vehicles, and sales stalled in the second half.

“Total sales in the second-half of 2021 were the slowest in a decade. Demand is healthy, but supply and production disruptions kept the industry in check. You can’t sell what you don’t have.”

Nor can you buy what you can’t get.

So if you can, you might want to wait until next year.

Chesbrough: “Heading into 2022, we believe the supply situation will improve but it will take time to restock the shelves at dealerships.  We expect modest gains in new-vehicle sales in the first quarter, and by the second half of the year a much more robust market should emerge.”

This, of course, is dependent on things like the semiconductor issue to be solved, to say nothing of improvement in the logistics situation (i.e., shipping and trucking).

But the numbers for 2021 are improved over ’20, so. . . .