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Cox Automotive Forecast: May Auto Sales Expected to Fall to Slowest Pace in 2022

Cox Automotive Forecast: May Auto Sales Expected to Fall to Slowest Pace in 2022
PR Newswire
ATLANTA, May 25, 2022

New-vehicle sales volume in May is forecast to fall nearly 28% from one year ago, to 1.14 million units.The new-vehicle sales pace is…

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Cox Automotive Forecast: May Auto Sales Expected to Fall to Slowest Pace in 2022

PR Newswire

  • New-vehicle sales volume in May is forecast to fall nearly 28% from one year ago, to 1.14 million units.
  • The new-vehicle sales pace is expected to finish near 13.1 million in May, the lowest point in 2022 and down from last month's 14.3 million pace.
  • Tight inventory and high prices continue to push many would-be buyers to the sidelines.

ATLANTA, May 25, 2022 /PRNewswire/ -- With no relief from elevated prices and tight new-vehicle inventory, U.S. auto sales in May are expected to drop to their lowest level of the year in May. According to the Cox Automotive forecast released today, the seasonally adjusted annual rate (SAAR) of new-vehicle sales in May is expected to hit 13.1 million, a step backward from April's 14.3 million level and far below the 16.9 million level posted in May 2021. 

U.S. auto sales in May are expected to drop to their lowest level of the year in May, according to Cox Automotive.

May sales volume is forecast to finish near 1.14 million units, down 9% from last month and nearly 28% from one year ago. Last year, in May 2021, new-vehicle sales reached 1.59 million, the second-best month of 2021 by volume, behind only March. While high prices and tight inventory are negatively impacting new-vehicle sales this month, the low sales volume can also be attributed to the calendar. There are 24 selling days this month, three fewer than last month and two fewer than May 2021.   

Tight inventory isn't the only headwind facing the market. Other issues may be having a growing impact. Rising interest rates and higher prices, and the resulting increase in monthly payments, are likely hurting demand as well. Vehicle affordability in the U.S. continues to worsen, according to the Cox Automotive/ Moody's Analytics Vehicle Affordability Index. In addition, lower consumer optimism in the wake of high inflation, surging gas prices, and a volatile stock market may be keeping some potential buyers from entering the market. 

"Historically, the daily sales pace is higher in May than in most other months, with spring optimism in the air, thoughts of summer road trips on the horizon, and the buzz of Memorial Day sales," said Charlie Chesbrough, senior economist at Cox Automotive. "But many of the industry's normal patterns have been overturned by tight inventory and the lingering effect of the global pandemic."

May 2022 Sales Forecast Highlights

  • Vehicle sales are expected to drop nearly 28% from May 2021 and fall 9% from last month.
  • The SAAR in May 2022 is estimated to be 13.1 million, below last year's 16.9 million level and down from April's 14.3 million pace.
  • May 2022 has 24 selling days, three fewer than last month and two fewer than May 2021.

May 2022 Sales Forecast


Sales Forecast1

Market Share


Segment

May-22

May-21

Apr-22

YOY%

MOM%

May-22

Apr-22

MOM


Mid-Size Car

70,000

110,104

77,306

-36.4%

-9.5%

6.1%

6.2%

0.0%


Compact Car

75,000

138,228

83,518

-45.7%

-10.2%

6.6%

6.7%

-0.1%


Compact SUV/Crossover

170,000

258,155

186,251

-34.1%

-8.7%

14.9%

14.9%

0.0%


Full-Size Pickup Truck

160,000

203,730

176,078

-21.5%

-9.1%

14.0%

14.1%

0.0%


Mid-Size SUV/Crossover

215,000

267,827

236,571

-19.7%

-9.1%

18.9%

18.9%

0.0%


Grand Total2

1,140,000

1,590,620

1,251,793

-28.3%

-8.9%





1 Cox Automotive Industry Insights data
2 Total includes segments not shown

 


All percentages are based on raw volume, not daily selling rate.

About Cox Automotive
Cox Automotive Inc. makes buying, selling, owning and using vehicles easier for everyone. The global company's more than 27,000 team members and family of brands, including Autotrader®, Dealer.com®, Dealertrack®, Kelley Blue Book®, Manheim®, NextGear Capital®, VinSolutions®, vAuto® and Xtime®, are passionate about helping millions of car shoppers, 40,000 auto dealer clients across five continents and many others throughout the automotive industry thrive for generations to come. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately-owned, Atlanta-based company with annual revenues of nearly $20 billion. www.coxautoinc.com

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SOURCE Cox Automotive

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Government

New Hampshire Governor Vetoes Ivermectin Bill

New Hampshire Governor Vetoes Ivermectin Bill

Authored by Alice Giordano via The Epoch Times (emphasis ours),

New Hampshire’s Republican…

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New Hampshire Governor Vetoes Ivermectin Bill

Authored by Alice Giordano via The Epoch Times (emphasis ours),

New Hampshire’s Republican Gov. Chris Sununu vetoed a bill that would have made Ivermectin available without a prescription.

Ivermectin tablets packaged for human use. (Natasha Holt/The Epoch Times)

The Republican governor vetoed the bill on June 24, the same day that the U.S. Supreme Court overturned Roe v. Wade. Some fellow Republicans questioned the timing.

It certainly seemed like a convenient way to bury a veto of a bill that won support from the vast majority of Republicans in New Hampshire,” JR Hoell, co-founder of the conservative watchdog group RebuildNH, told The Epoch Times.

Hoell is a former four-term House Republican planning to seek re-election after a four-year hiatus from the the New Hampshire legislature.

Earlier this year, the New Hampshire Department of Children Youth and Family (DCYF) tried to take custody of Hoell’s 13-year old son after a nurse reported him for giving human-grade ivermectin to the teen months earlier.

Several states have introduced bills to make human-grade ivermectin available without a prescription at a brick and mortar store. Currently, it can be ordered online from another country. In April, Tennessee became the the first state to sign such a measure into law. New Hampshire lawmakers were first to introduce the idea.

Both chambers of the state’s Republican controlled legislature approved the bill.

In his statement explaining the veto, Sununu noted that there are only four other controlled medications available without a prescription in New Hampshire and that each were only made available after “rigorous reviews and vetting to ensure” before being dispensed.

“Patients should always consult their doctor before taking medications so that they are fully aware of treatment options and potential unintended consequences of taking a medication that may limit other treatment options in the future,” Sununu said in his statement.

Sununu’s statement is very similar to testimony given by Paula Minnehan, senior vice president of state government regulations for the New Hampshire Hospital Association, at hearings on the bill.

Minnehan too placed emphasis on the review that went into the four prescription medications the state made available under a standing order. They include naloxone, the generic name for Narcan, which is used to counter opioid overdoses, hormone replacement therapy drugs, and a prescription-version of the morning after pill.

It also includes a collection of smoking cessation therapy drugs like Chantix, which has been linked to suicide, depression, and other neuropsychiatric conditions. Last year, Pfizer, the leading maker of the FDA-approved drug, conducted a voluntarily recall of Chantix. Narcan has also been linked to deaths caused by severe withdrawals that have led to acute respiratory distress.

Rep. Melissa Blasek, a Republican co-sponsor of the New Hampshire ivermectin bill, told The Epoch Times, that one could veto any drug-related bill under the pretense of overdose concerns.

The reality is you can overdose on Tylenol,” she said. “Ivermectin has one of the safest track records of any drug.”

The use of human-grade ivermectin became controversial when some doctors began promoting it for the treatment and prevention of COVID-19. Government agencies including the FDA and CDC issued warnings against its use while groups like Front Line COVID-19 Critical Care Alliance (FLCCC) heavily promoted it.

Some doctors were  disciplined for prescribing human-grade ivermectin for COVID-19 including a Maine doctor whose medical license was suspended by the state.

Read more here...

Tyler Durden Thu, 06/30/2022 - 20:30

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Economics

The One Housing Chart That Shows A ‘Buyer’s Market’ Has Returned

The One Housing Chart That Shows A ‘Buyer’s Market’ Has Returned

The red hot pandemic-era housing market is cooling as historically tight…

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The One Housing Chart That Shows A 'Buyer's Market' Has Returned

The red hot pandemic-era housing market is cooling as historically tight available inventory shows signs of reversing. 

An affordability crisis has removed millions of new home buyers as the number of active US listings soared 18.7% in June from a year earlier, the most significant increase in Realtor.com's data going back to 2017, according to Bloomberg. The days of insane bidding wars, waiving home inspections, and putting in an offer 20% or more over the list price appear to be over. In other words, a buyer's market could be emerging. 

"While we anticipate that more inventory will eventually cool the feverish pace of competition, the typical buyer has yet to see meaningful relief from quick-selling homes and record-high asking prices," said Danielle Hale, chief economist for Realtor.com. 

Austin, Texas; Phoenix, Arizona; and Raleigh, North Carolina saw active listings more than double from a year ago. Nashville, Tennessee, active listings jumped 86%, and 72% in the Riverside, California. 

The Federal Reserve's most aggressive tightening campaign sent the 30-year fixed-loan mortgage rate from 3% to over 6% this year (back in March, we warned coming rate explosion would trigger a housing affordability crisis), removing millions of new home buyers who can't afford the cost of homeownership as the median existing-home sales price was around $407k in May. 

Even though inventory is historically tight, supply is expected to increase in markets across the country as demand for loan applications among prospective buyers slumps. Fewer buyers equal more inventory. 

The takeaway is that inventory is rising as homes stay on the market longer because demand evaporated thanks to the housing affordability crisis -- this could mean a housing top is nearing. 

Tyler Durden Thu, 06/30/2022 - 18:50

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Economics

States Need To Avoid ‘Cures’ That Can Make Inflation Worse

States Need To Avoid ‘Cures’ That Can Make Inflation Worse

Authored by Regina M. Egea and Danielle Zanzalari via RealClearPolicy.com,

Across…

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States Need To Avoid 'Cures' That Can Make Inflation Worse

Authored by Regina M. Egea and Danielle Zanzalari via RealClearPolicy.com,

Across the United States, state governments are awash in cash. In a sharp contrast, American taxpayers are enduring a rate of inflation unseen in four decades, with the costs of everything from food to gasoline at record highs.

In our home state of New Jersey, Trenton is looking at an unprecedented surplus of $8 billion through a combination of increased tax revenue, federal pandemic aid and borrowing.

A natural impulse among residents and policymakers is to offer residents “relief” in the form of rebate checks.

The reality is that relying exclusively on rebates or direct cash transfers to individuals will only lead to more inflation as this puts more money in consumers’ hands exacerbating the same problem as today - too many dollars chasing too few goods.

Rather, it is prudent that states focus on long-term investment and responsible budgeting to ensure economic growth now and in the future. This is especially important in high tax, big spending states due to the greater flexibility in work arrangements that have exposed the reality that wealth is mobile.

With more residents fleeing high tax states to low tax states, states will need to reevaluate their tax and regulatory climate to stay competitive. 

Regulation can raise the costs for consumers and slow job growth. A series of studies shows the regulation raises prices and worsens poverty.

Working with local governments to revisit restrictive laws that contribute to higher housing prices, such as building height restrictions and zoning rules, as well as removing unnecessary restrictions on business operations will lead to more economic growth.

Another way states can aid productivity and long-term economic growth with their temporary budget surplus, is to fund training programs for middle-skilled jobs.

Nearly every industry has experienced labor shortages and that reality is especially acute in trades like auto, refrigeration, HVAC, electrical, welding, and manufacturing.

States can invest in these skills through high school and vocational school programs. With college borrowing costs astronomically high, this encourages individuals to pursue careers that are lucrative and budget friendly, as well as fill the over 75,000 job openings that our state of New Jersey is projected to need in just a few years.

To further long-term economic growth many states should also concentrate on fixing their unfunded pension liabilities for public employees. This impacts red and blue states alike, with massive liabilities in California ($1.53 trillion), Illinois ($533.72 billion), Texas ($529.70 billion), New York ($508.70 billion) and Ohio ($429.53 billion). Here in New Jersey, our liability is nearly $40,000 for every resident of the state, which can dramatically deter future growth. Beyond using some of states’ budget surplus to shore up pension liabilities, states should move public employees to defined contribution plans, which are used by more than 100 million Americans. These are found to have better investment returns than state-wide pension plans and cost taxpayers less.

Our final recommendation is perhaps our most important: Save for a rainy day. If the U.S. economy enters into a recession, this will mean fewer jobs and less tax revenue for states. To prepare for the future when states again face a budget shortfall, which may be sooner than we think, states should follow best practices of reserving 10% of their budget in a rainy day fund, to sustain essential programs should a downturn occur in the future.

As state leaders consider their budgets, they should focus on long-term economic growth initiatives. Proposals like funding middle-skilled job trainings ensure workers are ready for the next decade, whereas eliminating unnecessary regulations and focusing on pro-growth tax reforms encourages residents to build businesses and create jobs. Lastly, taking care of state finances by properly funding state employees’ retirement plans and saving for a rainy day will ensure that no state is left behind in the next economic downturn.

Tyler Durden Thu, 06/30/2022 - 17:50

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