The Detroit Three are expected to lose ground to Asian rivals when they report third-quarter U.S. sales this week, according to experts, as soaring gasoline prices due to the Iran war push buyers towards hybrids and more fuel-efficient models.
General Motors, Ford Motor and Stellantis could see their combined market share dip to around 36 per cent in the third quarter, while hybrid-heavy Asian brands including Toyota and Honda are expected to account for more than half of new vehicle sales in the period, industry research firm Cox Automotive said.
Hybrids have emerged as a top choice as consumers look to avoid high gasoline prices, which hit a national average of US$4.43 a gallon in September, according to AAA, compared with $3.20 a year earlier.
Toyota Motor Corporation is seen benefiting the most from the shift, with its overall third-quarter sales expected to have jumped 2.2 per cent from a year earlier.
While GM is expected to retain its top spot in the U.S. market, Cox estimates its overall quarterly sales fell 5.2 per cent from a year ago.
Hyundai Motor Group, meanwhile, is poised to surpass Ford in quarterly U.S. sales for the first time, with Cox forecasting 511,421 units sold, compared with Ford’s 504,172.
Stellantis’ quarterly sales are estimated to have fallen by about one per cent to 317,330 from a year earlier.
While borrowing costs have declined, this has done little to ease affordability pressures, said research firm JD Power, as higher new vehicle prices and lower trade-in values push monthly payments higher. The average transaction price for a new vehicle rose 1.9 per cent to $50,089 in August from a year earlier, according to Cox.
“Higher-income buyers who aren’t as squeezed by borrowing costs are likely doing the heavy lifting right now, while budget-conscious households are forced to hang onto older cars much longer,” said Jessica Caldwell, head of insights at Edmunds.
Cox estimates overall U.S. sales in the quarter at about 4.1 million units, down about one per cent from a year earlier.
(Reporting by Nathan Gomes in Bengaluru; Editing by Jonathan Ananda)
