- Wednesday, October 16, 2024
Recent data suggests a slowdown in U.S. car sales for the month of November, according to economists. Both Autodata Corp. and Wards Intelligence report a decline in sales figures compared to the previous month.
Autodata Corp.'s sales report reveals that November's seasonally adjusted annual rate totaled 15.5 million units, slightly down from the prior month's rate of 15.7 million. Similarly, data from Wards Intelligence indicates a sales rate of 15.32 million units, below the consensus estimate of 15.5 million units. These figures highlight a trend of subdued sales growth in the industry.
Will Compernolle, an economist at FHN Financial, suggests that though sales were soft, they remained within the range projected for 2023. Compernolle adds that the November sales data doesn't indicate a significant decline, and there is no apparent indication of a drop in consumer spending.
Speaking to this point, Michael Pearce, an economist at Oxford Economics, explains that the latest auto sales data reflects a deceleration in consumer spending since the third quarter. Pearce attributes this weakening trend to a combination of higher interest rates and tighter borrowing conditions, which ultimately diminishes buyer affordability.
Unless these conditions begin to ease substantially, vehicle sales will likely continue to remain subdued, according to Pearce.
Notably, the New York Fed has recently reported a record number of car loan rejections this year. Given the substantial contribution of car spending to overall U.S. consumer spending, this trend raises concerns about the future trajectory of the economy.
A more comprehensive retail spending report for November will be released by the government in mid-December.
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