U.S. quarterly auto sales jump on strong SUV demand, shift to EVs

imageEconomy40 minutes ago (Jul 01, 2021 03:11PM ET)

(C) Reuters. FILE PHOTO: The new GM logo is seen on the facade of the General Motors headquarters in Detroit, Michigan, U.S., March 16, 2021. REUTERS/Rebecca Cook

(Reuters) -U.S. automakers on Thursday reported a sharp rise in quarterly sales on strong demand for SUVs and pointed to the trend continuing into 2022, as more people shift to private conveyance and new electric vehicles (EVs) line up for launch.

Low interest rates, government stimulus and a preference for personal transportation due to the COVID-19 pandemic have bolstered demand for cars, even as prices have risen due to tight inventories following a global semiconductor shortage.

Higher vehicle prices have boosted profitability for automakers, who have also increased investments in EV production.

General Motors Co (NYSE:GM) said its Chevrolet Bolt EV posted record second-quarter deliveries, with total Chevrolet sales up 31%, while sales of its Buick premium SUVs soared 86%.

“We expect continued high demand in the second half of this year and into 2022,” Elaine Buckberg, GM’s chief economist, said.

Last month, the No.1 U.S. automaker increased its EV budget to $35 billion through 2025.

Japan’s Toyota Motor (NYSE:TM) Corp said alternative powered vehicles represented nearly one quarter of its sales volume through June this year, up from 13% a year earlier.

Toyota’s overall U.S. sales rose about 73% to 688,813 vehicles in the second quarter.

“There need to be more models beyond Tesla (NASDAQ:TSLA) … next year, the (Ford) F-150 Lightning should help move the needle upward,” said Morningstar analyst David Whiston.

Several new EVs will launch in the second half of 2021 including Chevrolet’s Bolt EUV, Hyundai’s Ioniq 5 and Kia’s EV6 models, helping lift the overall share of EVs in the United States from just 2% of all registered vehicles currently.

Ford, which sold more than 10,000 units of its Mustang Mach-E SUV in the first five months of this year, will launch the electric version of its best-selling F-150 pickup in 2022. The company is expected to report its sales numbers on Friday.

U.S. quarterly auto sales jump on strong SUV demand, shift to EVs

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