GM reclaims U.S. auto sales crown from Toyota

General Motors Co reclaimed the top spot in U.S. auto sales from rival Toyota Motor Corp in 2022 as it was able to better meet strong demand for cars and trucks despite industry-wide supply disruptions.

Shares of GM rose 2.7 percent in afternoon trade on Wednesday to $34.75, after the company posted a 2.5- percent rise in 2022 sales to 2,274,088 vehicles, higher than Toyota’s 2,108,458 units, in a closely watched race.

Inventory shortages stemming from surging material costs and a persistent chip crunch had hobbled production at many automakers, keeping car and truck prices elevated. Asian brands were hit hardest.

“Toyota is still among the tightest when it comes to inventory,” Cox Automotive senior economist Charlie Chesbrough said.

The Japanese automaker cut its full-year production target in November. Sales of its SUVs, a key segment, fell 8.6 percent in 2022, data on Wednesday showed.

However, Toyota executives said there were some positive signs emerging, and the rate of inventory buildup was slow but steady.

“We’re optimistic our inventory levels will continue to improve in the first quarter and for the remainder of the year,” said Andrew Gillel, senior vice president of automotive operations at Toyota.

Other brands such as Hyundai Motor America, Kia Motors America, Mazda North American Operations and American Honda all posted a drop in sales on Wednesday.

U.S. new vehicle sales in December finished at 1.26 million units, with an annual sales rate of 13.31 million, according to Wards Intelligence data.

Analysts are concerned that price hikes by automakers to blunt inflationary pressures and rising interest rates will take a toll on new vehicle sales in 2023.

Affordability is a “very real issue,” Toyota executive David Christ said. Nonetheless, the company expects demand to be robust this year.

Automakers will need to begin incentivising buyers, a trend that was paused during the pandemic, automotive marketplace TrueCar said.