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Big Three Automakers Rebound After Turbulent 2023

  • The U.S. automotive industry faced a turbulent year with a UAW strike and steel price hikes, yet saw an 11.6% increase in new car sales.
  • General Motors maintained its lead in sales, while the automotive MMI showed positive growth, indicating a recovering market.
  • The outlook for 2024 suggests a slower economic growth, an anticipated return to the pre-pandemic market normal, and easing chip shortages leading to increased vehicle supply and price reductions.

Via Metal Miner

While the index remained sideways for most of 2023, the automotive industry itself witnessed its fair share of shifts. For instance, the UAW strike forced numerous changes on the automotive industry while impacting automobile sales and production to varying degrees. Meanwhile, steel price hikes also caused the overall index to fluctuate and shift. All in all, the U.S. automotive industry witnessed numerous obstacles throughout 2023. By the end of the year, the Automotive MMI (Monthly Metals Index) rose 3.33%.

A Turbulent Year for Automotive Sales

Significant transformations transpired within the U.S. automotive sector in 2023. New automobile sales hit approximately 15.5 million units, marking an 11.6% surge over the previous year. This increase resulted from various factors, including amplified incentives, augmented supply levels, and heightened delivery rates.

Among the prominent manufacturers, General Motors maintained its position as the automobile sales leader, while Hyundai Motor Group surpassed Stellantis’ sales figures. On the other hand, Honda witnessed the most substantial year-over-year sales growth. However, the outlook for 2024 anticipates a return to the old “normal”  in the market. Moreover, analysts project that 2024 will witness slower economic growth, a surplus of new vehicles in inventory, and an end to the seller’s market.

Will the U.S. Automotive Market Return to “Normal” in 2024?

Cox Automotive expects 2024 to offer the most favorable conditions for automotive consumers since the pandemic. Anticipated trends include a marginal increase of less than 2% in new car sales and a less than 1% expansion in the used car market. Furthermore, the forecast suggests a resurgence of equilibrium within the automobile sector, affording consumers a wider array of choices, improved discounts, and enhanced accessibility to online shopping options.

Cox Automotive also predicts that the chip shortage, which significantly impacted the market over the past few years, will ease in 2024. This will lead to an augmentation in vehicle supply and a subsequent price decline. Either way, the U.S. automobile market remains poised for transformation in 2024, shifting towards a more stable and balanced environment. This shift will provide enhanced opportunities for both industry participants and consumers, notwithstanding the challenges that could arise.

The Big Three: Automobile Sales and Performance for 2023

The UAW strike drastically changed the dynamics of the U.S. automotive market in 2023, especially for Detroit’s “Big Three.” So, how exactly did the Big Three end the year?

  • Compared to the same period last year, Stellantis sales figures for Q4 indicate the sale of 343,552 automobiles, a marginal decline of 1%. During the third quarter, Stellantis reported a notable upswing in its net revenues, registering a substantial 7% increase to reach a total of €45.1 billion.
  • Before fully realizing the impact resulting from the work stoppage, Ford achieved noteworthy financial results, amassing a total of $4.9 billion in net profits and $9.4 billion in adjusted EBIT over the initial three quarters of the year. Analysts anticipate that the adjusted free cash flow for all of 2023 will fall within the range of $5.0 billion to $5.5 billion. During the third quarter of 2023, Ford brand automobile sales displayed a notable upswing, surging by 8% to 476,725 vehicles.
  • The Chevrolet brand was pivotal in driving a remarkable 21% growth in General Motors’ U.S. sales over the preceding year. According to the available data, the corporation achieved impressive results in the third quarter of 2023, with total sales amounting to $44.1 billion. Meanwhile, the net income attributable to stockholders reached $3.1 billion, and EBIT-adjusted figures totaled $3.6 billion. Furthermore, General Motors reported stellar sales performance for the entirety of 2023, selling 2.6 million vehicles. This represents a notable 14% increase compared to the previous year.previous year.

By Jennifer Kary

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