U.S. auto sales are projected to be markedly slower in August due to low supply, according to the latest Cox Automotive Forecast.

The seasonally adjusted annual rate (SAAR) of auto sales is expected to finish near 14.3 million, which is the slowest sales pace this year.

The August pace will be down from July’s 14.8 million pace. It is also down from August 2020’s 15.2 million level. The auto sales pace was averaging nearly 17.0 million a month through May.

Sales volume is expected to finish down 9% from last year, and down nearly 7% from last month. This month’s finish would be the fourth consecutive monthly decline of 500,000 units or more since April’s post-pandemic peak pace of 18.3 million, according to the forecast.

“Available inventory on dealer lots has been falling for months, and sales have been constrained further and further as a result,” said Cox Automotive Senior Economist Charlie Chesbrough. “And soon the market will enter the Labor Day holiday weekend, usually one of the highest sales periods of the entire year, but with half the supply they had last year.” 

Other notes from the forecast include new light-vehicle sales in the U.S. are projected to fall to 1.20 million units. That's down 118,000 units, or 9%, from last year.

Additionally, the SAAR in August 2021 is estimated to be 14.3 million, down from last August’s early COVID-19 recovery pace of 15.2 million.

Compact cars are forecast to see a year-over-year increase in August, but still lower than 2019.