Q3 2024

Industry Insights and

Sales Forecast Call
Sept. 25, 2024
Agenda
Time Check: 60 Minutes

Intro & Cox Automotive Mark Schirmer, Director, Corporate Communications

The Economy Jonathan Smoke, Chief Economist

New-Vehicle Market Charlie Chesbrough, Senior Economist

Used-Vehicle Market Jeremy Robb, Senior Director, Economic and Industry Insights

Electrified Market Stephanie Valdez Streaty, Director, Industry Insights

2024 Forecasts & Fall Playlist Jonathan Smoke, Chief Economist and Resident DJ

Q&A w/ Erin Keating, Senior Director, Economic and Industry Insights

and Mark Strand, Senior Director, Economic and Industry Insights

2
The Cox Automotive
Ecosystem
Our category-leading portfolio delivers the connected
solutions, tools and services that dealers, OEMs, lenders,
fleet operators and consumers expect.
The Economy
JONATHAN SMOKE
Chief Economist

4
Economic and Industry Context

1. Slowing economy and labor market

2. Normalizing new-vehicle supply but tight

used supply
3. The start of the journey to lower, normal
rates
4. 2025 policy-induced changes likely

5
The Economy

Real 4.9% 3.0% +2.0%

Overall Economy
GDP Growth (Q3 ’23) (Q2 ’24) (Q3 ’24 F)

U3 3.8% 4.3% 4.2%

Employment Conditions
Unemployment Rate (Aug ’23) (Jul ’24) (Aug ’24)

UofM 67.9 69.0 67.9

Buyer Confidence
Consumer Sentiment (Sep ’23) (Aug ’24) (Sep ’24 P)

Earnings 4.5% 3.6% 3.8%

Wages
Growth (Aug ’23) (Jul ’24) (Aug ’24)

Disposable 7.9% 3.6%

Buyer Ability
Income Y/Y (Jul ’23) (Jul ’24)

6
Fluctuations of the Fed Funds Rate Over 20 Years
The Fed’s monetary policy responds to economic conditions, including inflation and unemployment

6.00

5.00
4.83
4.00

3.00

2.00

1.00

0.00
Sep-04

Sep-07

Sep-08

Sep-11

Sep-12

Sep-15

Sep-16

Sep-19

Sep-20

Sep-23

Sep-24
Sep-05

Sep-06

Sep-09

Sep-10

Sep-13

Sep-14

Sep-17

Sep-18

Sep-21

Sep-22
Mar-05

Mar-06

Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Mar-12

Mar-13

Mar-14

Mar-15

Mar-16

Mar-17

Mar-18

Mar-19

Mar-20

Mar-21

Mar-22

Mar-23

Mar-24
Fed Funds Rate

Source: Federal Reserve Economic Data, Federal Reserve Bank of St. Louis 7
The Economy

$179 billion $179 billion

Auto Finance FRBNY
(Q2 ’23) (Q2 ’24)

Effective Fed 5.33% 4.83%

Interest Rates
Funds Rate (Sep ’23) (Sep ’24)

Average New Auto 9.62% 9.61%

Borrowing Costs
Loan Rate (Sep ’23) (Sep MTD ’24)

AAA Average Retail $3.82 $3.33 $3.21

Mobility Costs
Unleaded Gasoline Price (Sep ’23) (Aug ’24) (Sep 22, 2024)

8
 Dealer Sentiment Index
TH IRD QU A RTER 2024
Factors Holding Back Business

Q3 ’24 Q2 ’24 Q3 ’23 Q3 ’22

1 Economy 61% 57% 54% 53%

2 Interest Rates 59% 59% 61% 35%

OVERALL RANK

3 Political Climate 44% 36% 27% 30%

4 Market Conditions 41% 41% 41% 48%

5 Expenses 33% 31% 30% 28%

6 Credit Availability for Consumers 31% 31% 33% 18%

7 Consumer Confidence 30% 28% 25% 29%

8 Limited Inventory 30% 29% 37% 56%

9 Competition 15% 15% 13% 11%

10 Staff Turnover 8% 7% 8% 9%

Significant increase vs previous quarter

Dealer Sentiment Index Q3 2024 9

New-Vehicle Market
CHARLIE CHESBROUGH
Senior Economist

10
New-Vehicle Sales | Volatile But Growth Still Positive
Forecast for 2024 remains at 15.7 million, but more volatility expected through end of the year

Monthly Light Vehicle Sales SAAR (millions) Sales Volume SAAR

Date
20 (in millions) (in millions)
Sep-23 1.34 15.8
Sep-24 1.18 15.9
18 Change -11.9% 0.6%
Sept. 2024
15.9m Q3 2023 4.0 15.7
16 Q2 2024 4.1 15.7
Q3 2024 3.9 15.6
y/y % -2.1% -0.3%
14 q/q % -4.7% -0.3%

YTD 2023 11.6 15.5

12 YTD 2024 11.7 15.5
Sept. 2021 y/y % 0.6% 0.5%
12.3m
10 YTD-September Year Total
Selling Days 2023 230 306
Selling Days 2024 230 308
8
Jan-2018

Jan-2019

Jan-2021

Jan-2023

Jan-2024
Jan-2020

Jan-2022

Forecast
CY2023: 15.5 million
F2024: 15.7 million

Sou rce : Cox Automotive – Bur eau of Econo mic Analysis 11

Channel Sales | Leasing & Fleet Lead This Year’s Gains
High prices and rates hold purchasing down – Retail share of market back to pre-COVID lows

YTD Change In 2024 Sales Retail Share (Purchase+Lease) of Total Sales

25% 88%

Lease Share of Retail Retail Share

20%
YTD2023: 20% 86% - 8%
YTD2024: 25%
15%
84%

10%
82%
5%
80%
0%

78%
-5%

-10% 76%
Lease Purchase Rental Commercial 2018 2019 2020 2021 2022 2023 2024

Sou rce : Cox Automotive – Kelle y Blue Boo k 12

OEM Performance | GM Wins Q3 Sales, Honda Gains Share
Rebuilding of last year’s weak inventories is impacting performance for some brands

Y/Y Q/Q Share Share

Mfr Q3 2023 Q2 2024 Q3 2024 YTD 2023 YTD 2024 Change Difference
Change Change CY 2023 YTD 2024
GM 669,234 691,680 648,043 -3.2% -6.3% 1,957,815 1,929,778 -1.4% 16.5% 16.4% -0.2%
Toyota 590,296 621,549 547,460 -7.3% -11.9% 1,628,817 1,734,106 6.5% 14.4% 14.7% 0.3%
Ford 497,108 532,466 509,310 2.5% -4.3% 1,496,874 1,546,591 3.3% 12.7% 13.1% 0.4%
Hyundai 430,302 438,602 433,109 0.7% -1.3% 1,250,482 1,250,914 0.0% 10.6% 10.6% 0.0%
Honda 339,143 356,457 375,281 10.7% 5.3% 970,675 1,065,562 9.8% 8.4% 9.0% 0.7%
Stellantis 380,563 344,993 301,293 -20.8% -12.7% 1,183,538 978,827 -17.3% 9.8% 8.3% -1.5%
Nissan Mitsu 239,074 259,448 236,927 -0.9% -8.7% 764,785 777,513 1.7% 6.3% 6.6% 0.3%
Subaru 163,131 169,447 165,199 1.3% -2.5% 467,220 487,642 4.4% 4.1% 4.1% 0.1%
VW 167,279 170,603 166,718 -0.3% -2.3% 456,746 477,077 4.5% 4.1% 4.0% 0.0%
Tesla 156,621 164,264 152,829 -2.4% -7.0% 493,513 457,280 -7.3% 4.2% 3.9% -0.3%
Mazda 88,834 102,383 116,786 31.5% 14.1% 272,617 319,272 17.1% 2.3% 2.7% 0.4%
M-B 90,011 95,596 91,991 2.2% -3.8% 261,731 270,210 3.2% 2.3% 2.3% 0.0%
BMW 91,849 97,135 78,761 -14.2% -18.9% 277,132 266,740 -3.7% 2.5% 2.3% -0.3%
Others 76,334 76,388 73,406 -3.8% -3.9% 203,215 225,572 11.0% 1.8% 1.9% 0.1%
NATION 3,979,779 4,121,011 3,897,112 -2.1% -5.4% 11,685,160 11,787,083 0.9% 100.0% 100.0% 0.0%

Sou rce : Cox Au tomotive – Kelle y Blue Boo k

13
Note: O th ers category includes Ge ely Volvo, Tata JLR, Rivian, Lucid, Vinfast, Fisker
New-Vehicle Inventory | Approaching Pre-COVID Levels
Currently 800K more units (+40%) than last year; Days of supply at 77 (+26%)

Available Supply Days Of Supply

4,000,000 200

3,500,000 180
160
3,000,000
140
2,500,000 120
2,000,000 100

1,500,000 80
60
1,000,000
40
500,000 20
0 0
Oct-2019

Oct-2020

Oct-2021

Oct-2022

Oct-2023
Jan-2019

Jan-2020

Jan-2021

Jan-2023

Jan-2024
Jan-2022
Apr-2019

Apr-2020

Apr-2023

Apr-2024
Apr-2021

Apr-2022
Jul-2019

Jul-2020

Jul-2023

Jul-2024
Jul-2021

Jul-2022
Sou rce : Cox Automotive – vAuto 14
Incentives | Return of the Buyer’s Market
Excessive inventories are forcing price cuts
Incentive % of Transaction Price Price Share of MSRP
12% 104%

10% 102%

8% 7% 100%

6% 98%

4% 97%96%

2% 94%

0% 92%
Jan-2020

Jan-2021

Jan-2023

Jan-2024
Jan-2019

Jan-2022
Apr-2020

Apr-2021

Apr-2023
Apr-2019

Apr-2022

Apr-2024
Oct-2020

Oct-2022

Oct-2023
Oct-2019

Oct-2021
Jul-2020

Jul-2021

Jul-2023
Jul-2019

Jul-2022

Jul-2024
Price Strength Incentive % Transaction Price

Sou rce : Cox Automotive – Kelle y Blue Boo k 15

Transaction Prices | Now $47,870 - Down 1.7% From Last Year
Down 4% from peak - Discounting necessary to keep sales growing, and product mix changing

Estimated Monthly Transaction Prices

$47,870
$50,000

$48,000

$46,000 Supply Shortage

$44,000 Begins
May 2021
$42,000

$40,000

$38,000

$36,000

$34,000

$32,000

$30,000
Jan-2013

Jan-2015

Jan-2016

Jan-2017

Jan-2018

Jan-2020

Jan-2022

Jan-2023

Jan-2024
Jan-2012

Jan-2014

Jan-2019

Jan-2021
Sou rce : Cox Automotive – Kelle y Blue Boo k 16
Segment Sales | Affordability Leads This Year’s Gains
Larger, better margin products under-performing

Top 10 Segment YTD Sales

22%
20%
18% Top 10 Segments =
16% 86% of the market
14%
12%
10%
8%
6%
4%
2%
0%
-2%
-4%
-6%
-8%
Mid Car Full Truck Mid SUV Mid Truck Nation Lux Mid Lux Compact Full SUV Compact Subcomp
SUV Compact SUV Car SUV
SUV

Sou rce : Cox Automotive – Kelle y Blue Boo k, thr ough Aug ust 202 4 17
Used-Vehicle Market
Jeremy Robb
Senior Director of Economic and
Industry Insights

18
Wholesale Values Have Risen In Recent Months
While wholesale values are down Y/Y, they have bounced recently, slowing the rate of depreciation seen
265

245

225
203.6
205

185

165

145

125

105

85
Jan-98 Jan-01 Jan-04 Jan-07 Jan-10 Jan-13 Jan-16 Jan-19 Jan-22

Source: Cox Automotive 19

Used-Vehicle Sales | Holding Higher versus 2023
Weekly Sales estimates are slowly declining on a weekly basis but remain higher against the last two years

Estimated Rolling 30 Day Retail Sales weekly

9%

2024 2023 2022 2021

Aug

Sep
Apr
Feb

Jul
Jan

Jun
Mar

May

Oct

Nov

Dec
Source: Cox Automotive 20
Used-Vehicle Inventory | Much Tighter Recently
Days of supply declines to 42 days, as inventory levels contract more than any other week this year
Available Supply weekly Days of Supply weekly
2,700,000 65

2,600,000 60

2,500,000 55

2,400,000 50

2,300,000 45
14%
2,200,000 40

2,100,000 5% 35

2,000,000 30

1,900,000 2024 2023 2022 2021 2024 2023 2022 2021

25

1,800,000 20
Aug

Sep
Apr
Feb

Jul
Jan

Jun
Mar

May

Oct

Nov

Dec

Aug

Sep
Apr
Feb

Jul
Jan

Jun
Mar

May

Oct

Nov

Dec
Source: Cox Automotive 21
Used-Vehicle Listing Price | Treading Water Over The Summer
Listing Price is 6% lower Y/Y and remains below the last several years, helping affordability

Average List Price weekly

$29,000
$28,000
$27,000
$26,000
$25,000 6%
$24,000
$23,000
$22,000
$21,000
$20,000 2024 2023 2022 2021

$19,000
$18,000
Apr

Aug

Sep
Feb
Jan

Jun

Jul
May
Mar

Oct

Nov

Dec
Source: Manheim and Cox Automotive 22
Age Mix of Used Retail Evolves
Pandemic era supply issues have pushed the average age of used retail units offered for sale higher
Used Retail Age Mix of Inventory
100% 6.00 years
14% 14% 14% 16%
90%

80% 5.80 years

18% 21% 20%
21%

Average Age in Years

70%

60% 5.60 years

Age Mix

25%
26% 24% 23%
50%

40% 5.40 years

30%

20% 42% 40% 41% 40% 5.20 years

10%

0% 5.00 years
2021 2022 2023 2024
0 to 3 4 to 6 7 to 10 10+ Avg Age

Source: Cox Automotive 23

Off-Lease Trough Coming
In 2H 2024, lease maturities will drop substantially and will not bottom until late 2025
Monthly Estimated Lease Maturities
350,000

330,000

310,000

290,000
2023: 3.4M
270,000

250,000
2026: 3.0M
2024: 3.0M
230,000

210,000

190,000 2025: 2.5M

170,000

150,000
January February March April May June July August September October November December
2021 2022 2023 2024 2025 2026

Source: Kelley Blue Book and Manheim 24

Electrified Market
STEPHANIE VALDEZ STREATY
Director of Industry Insights

25
New EV Sales Estimate | Steady Demand, Share Growing
Estimating an 8% year-over-year increase in sales volume, and EV share of total sale nears 9%.
Chart Title
400,000 10.0%
+8% Y/Y
9.0%
350,000
8.0%
300,000
7.0%
250,000
6.0%

200,000 5.0%

4.0%
150,000
3.0%
100,000
2.0%
50,000
1.0%

0 0.0%
2022 Q1 2022 Q2 2022 Q3 2022 Q4 2023 Q1 2023 Q2 2023 Q3 2023 Q4 2024 Q1 2024 Q2 2024 Q3
EV Sales EV Share

Source: Kelley Blue Book 26

New EV Leasing | Still Attractive Consumer Option
EV leasing dropped slightly to 39%, still almost double the industry average. The number of vehicles leased YTD is
up 148%.

Lease Penetration of Retail Sales

45.0%

40.0%
39.4%
35.0%
Treasury announces leased EVs not
30.0% assembled in North America can
receive IRA tax credit.
25.0% December 2022

20.0%
20.7%
15.0%

10.0%

5.0%

0.0%

Jan-23

Jun-23

Jan-24
Jan-21

Jun-21

Jan-22

Jun-22

Jun-24
Apr-24
Apr-21

Apr-22

Apr-23
May-21

May-22
Jul-21

May-23

May-24
Jul-22

Jul-23
Oct-21

Oct-22

Oct-23
Nov-21
Dec-21

Nov-22
Dec-22

Nov-23
Dec-23
Aug-22

Aug-23
Aug-21
Sep-21

Sep-22

Sep-23
Mar-22

Mar-23
Feb-21
Mar-21

Mar-24
Feb-22

Feb-23

Feb-24
Total EV Industry

Source: Kelley Blue Book 27

 Alternative Fuel Share | Gateway to Electrification
Gas and plug-in hybrids are soaring, with HEVs up 16% and PHEVs up 14%.

Chart Title
100.0%
1.7% 1.9%

95.0% 7.3% Top 5 2024 Q2 Market Share Leaders

8.5%
HEVs Share PHEVs Share
Toyota 47% Jeep 31%
90.0%
Honda 20% Toyota 14%
7.2% Ford 14% Volvo 11%
8.0% Lexus 7% Chrysler 9%
85.0%
Hyundai 7% Mazda 7%

80.0%
83.7%
81.6%

75.0%
2021 2021 2021 2021 2022 2022 2022 2022 2023 2023 2023 2023 2024 2024
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
ICE % BEV % HEV % PHEV %

Source: Kelley Blue Book 28

Used EV Sales Estimate | Exponential Growth
Estimating an 69% year-over-year increase in sales volume, and EV share hovering around 1.7%.
Chart Title
90,000 2.0%
+69% Y/Y
80,000 1.8%

1.6%
70,000

1.4%
60,000
1.2%
50,000
1.0%
40,000
0.8%
30,000
0.6%

20,000
0.4%

10,000 0.2%

0 0.0%
2022 Q1 2022 Q2 2022 Q3 2022 Q4 2023 Q1 2023 Q2 2023 Q3 2023 Q4 2024 Q1 2024 Q2 2024 Q3
EV Sales EV Share

Source: Kelley Blue Book 29

 New and Used EV Sales | August Month and Year Over Year
Both new and used EV sales reached record volumes in August, showing strong year-over-year growth.

New EV Sales Used EV Sales

1,600,000 100.0%
1,400,000 100.0%
90.0% 1,400,000 90.0%
1,200,000
80.0% 80.0%
1,000,000 70.0% 119,652 1,200,000
70.0% 26,846
August Sales 1,000,000 60.0% August Sales
800,000 60.0%
50.0% 800,000 50.0%
600,000 40.0% 40.0%
600,000
400,000 30.0% 30.0%
9.6% M/M 400,000 1.8% M/M
20.0% 20.0%
200,000 200,000
10.0% 12.6% Y/Y 10.0% 64.4% Y/Y
0 0.0% 0 0.0%
EV Sales ICE+ Sales EV Sales ICE+ Sales
Aug-24 Share

Source: Kelley Blue Book 30

 New and Used EV Day’s Supply | August Month and Year Over Year
Both new and used EV days’ supply continues to decline, with used EV days’ supply now matching that of ICE+
vehicles.

New EV Days’ Supply Used EV Days’ Supply

100
90.2 38.5
38.2
90
80 90 38 37.8 38
70 67.4 August August
60
Days’ Supply 37.5 Days’ Supply
50
37
40
30 47.3% M/M 36.5 30.4% M/M
20
36
10 12.4% Y/Y 32.4% Y/Y
0
35.5
EV Model Group ICE+ Model Group
EV Model Group ICE+ Model Group

Note: Tesla, Rivia n a nd Brands with a “Direct to Consumer

Platform” are not represented.

Source: Cox Automotive analysis of industry, vAuto 31

 New and Used EV Prices | August Month and Year Over Year
New EV ATP remains flat, while used EV ATP is slightly up but down 12.8% year-over-year, nearing price parity with
ICE+ vehicles.

New EV ATP Used EV ATP

$58,000 $40,000

$35,000
$56,000
$56,574 $35,937
$54,000 August ATP $30,000 August ATP
$52,000 $25,000

$50,000 $20,000

$48,000 $15,000
0.1% M/M 3.4% M/M
$10,000
$46,000
0.9% Y/Y 12.8% Y/Y
$5,000
$44,000
$0
$42,000 EV ATP ICE+ ATP
EV ATP ICE+ ATP

Data in clud e o nly 5yo MYs or newer

Source: Kelley Blue Book, Dealertrack, vAuto 32

2024 Forecast & Playlist
JONATHAN SMOKE
Chief Economist

33
Forecast: 2024
“The Waiting is the Hardest Part”

1. Slow Growth Ahead; Now Less Slowing in 2024 but

has been better than feared.
15.7M
new-vehicles
sold in the U.S.
in 2024
2. New Vehicle Supply Is Back to Favoring
Consumers, with Downward Pressure on Prices.

3. In 2024, We Officially Bid Farewell to the

Seller’s Market.

4. In the Electric Vehicle Market, 2024 Will Be the

Year of More. 1.3M
electric vehicles
sold in the U.S.
5. Car Buying in America: The worst is over, and with in 2024
rates expected to decline soon, even better
conditions ahead.
34
 15.7M 12.7M 3.0M
NEW SALES NEW RETAIL SALES FLEET SALES
(2023: 15.5M) (2023: 12.7M) (2023: 2.8M)

2024 Forecasts 3.1M 25% 2.6M

Updated Sept. 25, 2024 LEASE CPO SALES
NEW LEASE
VOLUME PENETRATION (2023: 2.6M)
(2023: 2.7M) (2023: 21%)

37.3M 19.9M -2.3%

USED RETAIL SALES DEC 2024 Y/Y MANHEIM
USED SALES USED VEHICLE
(2023: 36.4M) (2023: 19.3M) VALUE INDEX
(2023: -7.0%)
35
 Fall Playlist

Everybody Wants to I’ll Feel a Whole Changes September

Rule the World Lot Better By David Bowie By Earth, Wind & Fire
By Tears for Fears By The Byrds
No matter who wins, There’s dancing in
The election is just Sentiment should 2025 will initiate September as the Fed starts
around the corner. improve with changes. cutting rates.
uncertainty diminishing
after the election.
Q&A
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38
THANK YOU
FOR ATTENDING!
Contact us with questions or to
speak with an expert:

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Senior Manager
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[email protected]

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Director
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[email protected]