General Motors Co. and Ford Motor Co. eked out small fourth-quarter gains while Toyota Motor Corp. and Honda Motor Co. finished 2023 with double-digit sales increases in December, capping the U.S. auto industry's best full-year total since 2019.
The market rose 16 percent to 1.5 million last month, well above forecasts, GlobalData said Jan. 4 in a preliminary report, and finished up 13 percent at 15.6 million for all of 2023.
"End-of-year deals appeared to lure many more buyers across the country, with automakers willing to offer more significant discounts and, in some cases, divert more volume to fleet sales," GlobalData said.
The seasonally adjusted, annualized rate of sales last month tallied 16.4 million, the highest since May 2021, GlobalData said, and well above the range of forecasts of 15.1 million to 15.4 million. The sales pace, which totaled 13.77 million in December 2022, had cooled since its previous 2023 peak of 16.22 million in June.
But there are signs of a slowing market in 2024, as elevated borrowing costs and new-vehice prices continue to sideline some shoppers. Among major automakers, Stellantis was the only one to post a fourth-quarter and annual decline.
"Consumers in December showed a willingness to purchase if the price was right. Continued discounting or moderating pricing could bring a more pronounced lift to demand in 2024," said Jeff Schuster, vice president of research and analysis at GlobalData's automotive practice. "We expect a slight January hangover in demand, given the likely pull forward, and there remains economic risk that needs to be factored as we start the new year."
Schuster said the state of the overall U.S. economy, notably employment levels and interest rates, and pricing trends will be the dominant drivers in auto demand for 2024.