Hyundai and Kia achieved record sales in the US in Q1 2023, with volume rising 27% to 75,404 in March alone for Hyundai, and sales advancing 20% to 71,294 at Kia. As the US auto market is set to rise by 1-7% in March, rising demand is driving up prices. Incentives remain low due to tight supplies, and prices for new vehicles are increasing, with an average transaction price of $45,818, up 3.5% YoY. U.S. auto sales are forecast to rise again in 2023 to 14.2 to 15 million, driven by the second half of the year with continuing inventory rebounds, while Edmunds states that the average days to turn for new vehicles climbed to 34 days in Q1 of 2023, compared to 24 days in the Q1 of 2022. The average trade-in age of vehicles towards new car purchases increased slightly, from 5.3 years in Q1 2022 to 5.9 years in Q1 of 2023. The industry is currently supply-constrained, and profitability is above historic norms due to softening dealer margins and increased manufacturer incentive spending, but the availability of new vehicles on retailer inventory is improving.
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