April 3 (Reuters) – U.S. auto sales are expected to rise for a second straight quarter as automakers can ship more vehicles to dealers on time, analysts said, while also it will focus on watching for signs of stagnant demand.
Vehicle production took a hit after the pandemic disrupted supplies of semiconductor chips and other raw materials, hurting automakers’ ability to meet rising demand for personal mobility. Companies have been playing catch-up ever since, as supply chain woes gradually eased.
But rising interest rates and fears of a recession could play havoc with an industry where most vehicle purchases are financed with loans, analysts say. The average transaction price of vehicles has also increased over the past year.
“Consumers face credit uncertainty as soaring interest rates have created barriers to entry for even the most qualified buyers,” said Jessica Caldwell, the firm’s chief information officer. edmunds auto research.
Detroit giant General Motors Co ( GM.N ) said earlier this year it would halt production at its Fort Wayne Assembly truck plant in Indiana for two weeks to manage inventory.
The carmaker expects a 15 percent rise in first-quarter U.S. sales, while sales at Japanese rival Toyota Motor Corp ( 7203.T ) are likely to fall nearly 10 percent, when it releases data from Monday , according to consulting firm Cox Automotive.
Toyota has continued to struggle with inventory shortages caused by supply constraints, losing its crown as America’s top-selling automaker to GM.
Edmunds expects a total of 3,502,324 new cars and trucks to be sold in the US in the quarter through March, up from last year but down 1.8% from the fourth quarter.
Trucks and crossover SUVs are expected to account for the majority of new retail sales in the quarter, according to automotive data firm JD Power.
Reporting by Nathan Gomes in Bangalore; Editing by Shilpi Majumdar
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