The growing popularity of electrified vehicles wasn’t enough to offset shortages of key products and depleted inventories in May with Toyota, Honda, Subaru, Kia and Hyundai reporting sales declines for the month.
Toyota Motor North America reported May sales dropped 27.3% on a volume basis. Toyota Division sales for the month totaled 154,223 vehicles, down 27.4%, while Lexus Division sales for the month totaled 21,767 vehicles, down 26.8 percent.
TMNA’s May 2022 electrified sales dropped slightly less, 21.8%, but still represent 26.2 % of total TMNA sales versus 24.3% in May 2021. So far this year, total electrified vehicle sales represent 25.9% of total TMNA sales versus 23.4% in last year.
According to David Christ, head of Toyota division, U.S. dealers have an average of only six vehicles in inventory. “We’re selling them as fast as we can build them,” he said.
Second half rally?
Bob Carter, TMNA vice president, added, “The factor suppressing sales is a lack of inventory. None of us have ever seen anything like this,” he added. “We estimate it will take until we’ll into 2023, maybe into the third quarter, before inventories begin to normalize.”
Carter’s estimate echoes forecasts by Thomas King, president of J.D. Power’s data and analytics division, who said last week the second half of the year should see some stability return.
Honda also blamed the lack of inventory for a steep sales decline during May, dropping 57.3%. Honda brand sales dropped 56.5% and Acura sales dropped 64.4 percent.
American Honda May sales top 75,000 units, with supply constrained and inventories at historic lows, but added strong retail demand yields record high turn rates of over 80% for Honda brand.
More than half of Civics and CR-Vs are pre-sold before they reach Honda dealer lots. Strong pre-sales of the next-gen Integra creates positive energy at Acura dealers ahead of June 2 sales launch.
Lack of inventory continues to hurt sales
Subaru of America reported 42,526 vehicle sales for May 2022, a 24.8% decrease compared with May 2021.
“Our retailers continue to set the standard for an exemplary customer experience, and we’re proud of their efforts to make our customer’s ownership experience the best in the industry,” said Thomas J. Doll, president and CEO of Subaru of America Inc.
“We’re continuing to see supply chain challenges across the industry, and we are focused on delivering the top-notch vehicles and standout customer experience that Subaru is renowned for,” said Jeff Walters, senior vice president of Sales.
Meanwhile, South Korean carmakers, Kia and Hyundai reported increased sales of electrified vehicles.
“Kia’s electrified vehicle sales remain strong and are contributing to the brand’s path to another successful year,” said Eric Watson, vice president, sales operations, Kia America. “With the continued popularity of the EV6 and Niro, coupled with early robust interest in the Sportage hybrid, we are confidently ‘on target’ and expect to see momentum continue throughout the summer sales season.”
Overall, though Kia sales dropped 28% in May.
Hyundai Motor America reported May retail sales of 59,432 units, a 30% decrease compared with May 2021. May was an all-time record month for Santa Cruz retail sales. Hyundai had no fleet sales in May 2022.
“There continues to be extraordinary consumer demand for Hyundai vehicles, with dealers selling every vehicle they get,” said Randy Parker, senior vice president, national sales, Hyundai Motor America. “We expect demand to remain strong and inventory levels to improve later in 2022.”