Detroit automaker General Motors (GM) has reported a 2.2% year-over-year decline in its third-quarter sales amid growing signs of a slowdown in the global automotive industry.
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General Motors, which is America’s largest vehicle manufacturer, reported that its sales within the U.S. during Q3 fell to 659,601 units, down 2.2%. A year earlier, the company’s sales had grown 21% as a backlog that built up during the Covid-19 pandemic was unwound.
In reporting its latest sales figures, General Motors said that consumers in the U.S. are buying fewer new vehicles amid persistently high inflation and elevated interest rates. The company added that American consumers are trading down and buying more affordable vehicles. The Trax compact SUV was GM’s bestselling nameplate during Q3, with sales rising nearly 60% year-over-year to 59,299 units.
A Global Slowdown in Vehicle Sales
General Motors isn’t the only automaker to report a sales slowdown. In recent months, companies ranging from Volkswagen AG (DE:VOW3) to Toyota Motor Corp. (TM) have revised down their outlooks, citing a sales slump, particularly of more expensive electric vehicles.
On the same day that General Motors released its Q3 U.S. sales numbers, market research firm J.D. Power said that it estimates overall new vehicle sales in the U.S. rose a tepid 0.2% to 3,882,600 units in the year’s third quarter. J.D. Power said consumers are struggling with higher costs and moving away from purchasing new vehicles.
Is GM Stock a Buy?
General Motors stock has a consensus Moderate Buy rating among 16 Wall Street analysts. This rating is based on nine Buy, four Hold and three Sell ratings issued in the last three months. The average GM price target of $56.83 implies 26.75% upside potential from where the stock currently trades.
Read more analyst ratings on GM stock
