May sales roared, despite puny inventories

“May sales appeared to be strong but probably left many automakers wondering what would have been if inventory were more plentiful,” said Jessica Caldwell, executive director of insights at Edmunds. “One thing that is working for automakers and dealers is that Americans are ready to spend money and want to buy cars.”Most automakers no longer release monthly sales figures, but analysts said the overall industry posted strong results last month.

Morgan Stanley estimated last week that the market advanced 42 percent in May, and LMC Automotive pegged the gain at 43 percent.

The seasonally adjusted, annualized rate of sales came in at 17.1 million for the month, Morgan Stanley said, well above the 16.2 million to 16.7 million forecasts from various analysts. It was down from April’s 18.5 million but far above the 12.1 million tallied in May 2020.

In a research note, Morgan Stanley attributed the strong demand to “greater than expected stimulus support in the first quarter, pent-up demand coming out of 2020, a stronger than expected U.S. economy … record high used car pricing and favorable credit conditions that continue to support auto sales.”

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