New light-vehicle sales in October saw their first month-to-month gain since April. The October 2021 SAAR totaled 13 million units, down 20.8% from October 2020 but up 6.3% from one month earlier. 

October sales began with the lowest inventory levels on record, at 972,000 units, and the low inventory continues to keep sales rates below current market demand. October’s month-end inventory levels did not show significant change from September. In this tight market, OEMs continue to prioritize retail deliveries over fleet deliveries. According to J.D. Power, fleet sales accounted for just 13% of new-vehicle sales in October.

Light-truck market share last month topped 80% for the first time, representing 80.2% of all new light vehicles sold. Through the first 10 months of the year, light trucks have accounted for 77.2% of new-vehicle sales. After setting a record in September 2021, average new light-vehicle transaction prices set a new record of just under $44,000, said J.D. Power. Prices have risen due to limited new-vehicle supplies and reduced OEM incentive spending. 

Accordingly, average incentive spending per unit also hit a new record low of $1,628. Consumers facing these rising prices have benefited from very strong trade-in values. J.D. Power estimates that the average trade-in value is up 70% year over year.   

For the rest of 2021, dealers are expected to continue to sell most of their inventory soon after it reaches their lots as they work their way through their customer order books. Therefore, little change to overall inventory levels is expected before year-end. Inventory levels should begin to slowly and steadily increase throughout 2022, but likely will remain below pre-COVID levels. Forecasters expect new light-vehicle sales in 2021 to total about 15.2 million units.