Low Auto Inventory and Higher Prices Wear Down Frustrated Car Shoppers
The auto industry’s more than yearlong struggle to get more vehicles on dealership lots is starting to wear on car shoppers, some of whom are giving up and dropping out of the market until the situation improves, reports The Wall Street Journal. Major car companies are expected to report third-quarter U.S. sales on Friday, with analysts predicting that quarterly results will fall for the first time this year. Research firm J.D. Power forecast auto-industry sales will total 3.3 million for the July-to-September period, a 13% drop from the year-earlier quarter. A significant driver behind the decline is a lack of car-and-truck inventory as auto makers continue to confront a global computer-chip shortage that is denting factory output and expected to last into next year, according to dealers, analysts and auto executives. With inventory tight, consumers are having to pay top dollar to get the vehicle they want, prompting some shoppers to hold off on purchases. Frustration is occurring among buyers of both new and used cars, as vehicle supplies are scarce across the board. Read more here (Source: The Wall Street Journal).
12 Auto Execs Push House Speaker Pelosi for Broader EV Tax Credits
Top U.S. executives from 12 international automakers are urging the U.S. House of Representatives to support broader tax credits for electric vehicles in the Democrats' $3.5 trillion reconciliation bill. In a letter sent Thursday to House Speaker Nancy Pelosi, executives from automakers including American Honda Motor Co., Toyota Motor North America, and Volkswagen Group of America called for "policies that offer incentives to all electric vehicles made by all American auto workers" and to oppose "policies that slow progress toward meeting our nation's climate goals." The American International Automobile Dealers Association also urged House leaders to oppose the EV tax credit proposal in a separate letter sent Thursday. The association, which launched an awareness campaign Monday to bring attention to the proposal's potential employment and environmental consequences, said the policy would "pit American workers against one another and limit consumer choice." Read more here (Source: Automotive News).
The House of Representatives is expected to vote on the discriminatory $4,500 union-built EV tax credit soon.
Dealers and their employees should contact their Members of Congress and urge them to oppose this proposal that will divide American workers and play politics with car sales. Click here to learn more about the issue.
Toyota, Mazda U.S. Joint Venture to Hire 1,700 Additional Employees
Toyota Motor Corp (7203.T) and Mazda Motor Corp's joint venture factory in the United States will hire 1,700 additional employees as it ramps up production, the companies said on Thursday. Reuters reports that Mazda Toyota Manufacturing, which has started making the 2022 Toyota Corolla Cross model, expects to have 4,000 workers in total by next year, when production of the yet-to-be-announced Mazda vehicle will also begin. The JV expects to produce 150,000 future Mazda crossover vehicles and 150,000 Toyota sport utility vehicles annually. Last year, Toyota and Mazda increased their investment in the JV by $830 million to $2.3 billion. Read more here (Source: Reuters).
Alphabet's Waymo and GM's Cruise Get Calif. DMV Approval to Run Commercial Autonomous Car Services
The California Department of Motor Vehicles approved autonomous vehicle deployment permits for GM-backed Cruise and Alphabet’s Waymo on Thursday. It allows the companies to charge a fee and receive compensation for autonomous services offered to the public, such as ride-hailing, in certain areas, reports CNBC. The companies still need approval from the California Public Utilities Commission, according to the California DMV, but it means the companies are one step closer to providing services to the general public outside of a testing program. Both companies have been testing fleets of autonomous vehicles in California with permits that allow for free driverless rides to passengers in test vehicles. Under the new authorization, Cruise vehicles can operate on public roads in designated parts of San Francisco between 10 p.m. and 6 a.m., including in light rain or light fog, but cannot exceed 30 miles per hour, the department said. Waymo can operate its fleet in parts of San Francisco and San Mateo counties at or below 65 mph, including in the rain or light fog. Read more here (Source: CNBC).
Kia, Hyundai Slip Again in Sept. Behind Tight Supplies
The global chip shortage continued to hammer automakers last month, with Hyundai and Kia reporting lower U.S. sales in September for the second straight month, according to Automotive News. Volume dropped 1.8 percent at Hyundai and 4.7 percent at Kia, though both automakers racked up overall gains for the third quarter behind strong July deliveries. Hyundai said retail sales slipped 5 percent to 49,439 last month as a result of what Randy Parker, head of sales, called a "challenging inventory environment." Genesis posted a 332 percent increase in Sept. volume, with sales of the GV70 and GV80 crossovers each outpacing combined deliveries of the brand's three sedans. Most other automakers will report September and third-quarter sales later Friday. Ford Motor Co. will release results on Monday, followed by Daimler later in the week. U.S. sales are forecasts to fall about 25 percent in September, based on estimates from J.D. Power, LMC Automotive, TrueCar, and Cox Automotive, capping a quarter that will see industry volume drop 13 percent to 14 percent. Ony three automakers – Toyota, Hyundai, and Kia – are forecast to post higher third-quarter results, according to estimates from TrueCar and Edmunds. Read more here (Source: Automotive News).
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