Growth in U.S. auto sales slowed significantly in the second quarter, hampered by a cyber incident at CDK Global. Despite this setback, steady demand and improved vehicle availability kept sales relatively high.
Cox Automotive estimates that U.S. new-vehicle sales in the second quarter grew by 1%, reaching nearly 4.2 million units. This is a stark contrast to the 16% surge seen in the same period last year.
Industry experts noted the impact of the cyber incident at CDK, a retail technology and software provider, which disrupted dealers nationwide in June. “The CDK cyberattacks have thrown a monkey wrench into sales during the second half of June, affecting what is arguably one of the most lucrative and busiest times of the month and quarter for dealerships,” said Jessica Caldwell, head of insights at Edmunds.
The outage at CDK, which supports more than 15,000 retail locations in the U.S., marked another challenge for automakers. Analysts, however, are optimistic that vehicle retailers and automakers will recover most of the lost sales in July.
Automakers have benefited from strong demand for SUVs, pickup trucks, and hybrid vehicles. Discounts on certain models and incentives have attracted budget-conscious shoppers, helping some manufacturers close the gap with rivals. For instance, electric vehicle makers have made strides in catching up with Tesla for the title of the world’s top EV seller.
General Motors is expected to maintain its leading position in the quarter, closely followed by Toyota’s North America unit and Ford, according to Cox Automotive. The launch of more affordable, feature-packed models has also drawn buyers looking to replace older vehicles.
Despite the positive outlook, Cox expressed concerns about sustaining this growth through the latter part of the year, citing uncertainties like the upcoming U.S. presidential election. “New vehicle affordability concerns remain prevalent, and inventories are not expected to advance as strongly as they have over the past 12 months,” said Chris Hopson, an analyst at S&P Global Mobility.
As the industry navigates these challenges, the focus remains on balancing supply and demand while addressing potential disruptions in the market.
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