General Motors Holds Onto Top Spot, EV Sales Hit New Record, Tesla is Luxury Leader: Takeaways from Q3 2022 U.S. Auto Sales

New-vehicle sales in the U.S. were remarkably stable through the third quarter of 2022. Sales volumes in July came in at 1.14 million units and followed in August at 1.14 million. September sales dropped a bit, to 1.12 million. In fact, the Q3 average of 1.13 million sales a month was aligned with the market average sales volume for the past year, which was, again, an average of 1.13 million vehicles sold each month. See the pattern here?

Tight new-vehicle inventory is still a major driver of the market dynamics, such that we have never seen before. Higher interest rates are now tamping down demand as well. Cox Automotive lowered its full-year new-vehicle sales forecast for 2022 to 13.7 million, an acknowledgment that vehicle sales volumes will likely remain stable at a lower level through the fourth quarter.

As we shut the books on Q3 2022 on a market that is slow and slowing, our team at Kelley Blue Book assembled two broad new-vehicle sales reports. One is a look across industry-wide U.S. sales. The other is a narrow review of electrified vehicle sales in the U.S., which counts combined sales of hybrids, plug-in hybrids (PHEVs), and EVs.

While sales volumes did not shift notably across Q3 or year over year, we have noted some interesting market dynamics in the data, and a few winners and losers. Here are 10 quick takeaways from the Q3 Kelley Blue Book sales counts.  

1. Electric vehicles continue to be the hot segment in the U.S. market, far outpacing the rest of the industry in terms of sales and share growth and consumer interest. A record number of EVs were sold in Q3 – more than 200,000 sold in a three-month span, a first – and new entries continue to gobble up share. Tesla is still the lead brand when it comes to EV sales, but strong growth from the Hyundai Motor Group, Ford and others continues to diversify the growing EV market.
   
2. A big story in 2022 continues to be the growing share of luxury brand sales. As prices rise and loan rates increase, the new-vehicle market continues to cater to high-income, high-credit-score buyers who are more likely to buy luxury. In the third quarter, the luxury share of the market was 17.8%. In the same time period in 2019, luxury share was 14.1%.
   
3. Throughout Q3, Honda dealers suffered through inventory issues. Total Honda sale in the quarter reached only 200,257, the lowest quarter of 2022 and, honestly, the worst quarterly sales performance for Honda in memory. There have been better times. In Q3 2019, Honda sold nearly 400,000 vehicles.
   
4. Tesla’s share of the EV segment slumped lower in Q3, although at 64% share, ‘lower’ is a relative term. Importantly, as many pundits are correctly noting, a declining share was a foregone conclusion for Tesla as more players hopped into the EV segment. More importantly, in Q3 Tesla easily held on to the top spot in the luxury market, outselling #2 Mercedes by a large margin.
   
5. New-vehicle transaction prices set a record in July, at $48,072.  And another record in August, at $48,240, as incentives fell lower.  September prices came down slightly but held above $48,000. In Q3, new-vehicle prices were higher than ever, thanks in part to a high mix of luxury sales (Point #2) and dwindling incentives.  Affordability issues are real.  
   
6. The midsize SUV, compact SUV and full-size truck segments continue to be the segments that matter most in the U.S. market. In Q3, those three segments accounted for 47% of total sales. The top-selling midsize SUV segment is more competitive than ever, with 22 unique models to choose.
   
7. Toyota may be stumbling into the EV market, but the company is the gold standard for hybrid powertrains. Hybrid sales for Toyota decreased in Q3 year over year thanks mostly to tight inventory but moved nearly 100,000 hybrids in the quarter. Year to date, nearly half of all hybrids sold in the U.S. market wore a Toyota badge.  
   
8. Who was #1 in sales in the U.S. in Q3? That would be General Motors. Inventory-tight Toyota was outpaced by more than 25,000 sales. GM struggled with inventory in 2021, but this year seems to be on track to claim the top sales spot for 2022.
   
9. This again: Ford’s F-Series was the best-selling vehicle in Q3. By far. A total of 167,962 were sold. On the other end of that scale, consider the outgoing Fiat 124. Total sales in Q3: 17.
   
10. The Top 30 best-selling vehicles (out of the roughly 275 available) accounted for nearly half of total sales in Q3. There’s a rule of thumb in the auto industry that just a handful of vehicles deliver significant sales volumes in a given month, quarter or year. That seems to be true even when inventory is limited: In September, the 30 top-selling vehicles accounted for 48.2% of total sales. In Q3, that same set of 30 vehicles accounted for 47.8% of sales.