GM: UAW Strike Probably Means Third-Quarter Sales Strength Won't Be Repeated in Fourth Quarter

Most automakers reported third-quarter or September U.S. auto sales on Oct. 3 with Wards putting the month’s deliveries to end customers up 18.5% from September 2022, or 13.9% after factoring in one more selling day this September. Third-quarter deliveries grew by 16.8%. The month’s seasonally adjusted annualized selling rate was 15.67 million up from 13.70 million a year ago. J.D. Power estimated September incentives per unit at $1,806 which is 81% higher year over year but off a very low base as poor supply from the chip shortage made discounting a low priority. Incentives as a percentage of average manufacturer's suggested retail price are only 3.7%—quite low in absolute level terms, even though it’s up 160 basis points year over year. Demand remains robust as consumers realize pent-up demand from the start of the pandemic. The UAW strike will not help fourth-quarter numbers and the Detroit Three entered September with about 40% less dealer inventory than just before the 40-day GM strike four years ago. However, the strike is hitting certain vehicles rather than all plants at once and as of Oct. 3 has not affected full-size pickups or full-size SUV production.