"Available inventory on dealer lots has been falling for months, and sales have been constrained further and further as a result," he said. "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."

Cox Automotive on Wednesday forecast August SAAR would be 14.3 million for new cars, down from July's supply-constrained 14.8 million and the slowest since it fell to 13 million in June 2020. New cars sales had been 7 million SAAR a month from January through May.

TrueCar Inc. of Santa Monica on Thursday forecast dealers will sell 1.1 million new cars and light trucks in August, a seasonally adjusted annual rate of 14.4 million, which is 4% lower than a year ago. August volume about the same as July after adjusting for the number of selling days.

Nick Woolard, TrueCar's lead industry analyst, said about a third of vehicles are selling within a week of arriving on a dealer's lot, compared with 18% a year ago.

"Continued strong demand is creating an environment where vehicles are selling extremely quickly," Woolard said. "The chip shortage continues to be the driving force behind vehicle availability, creating the lowest average incentive spending since 2013."

TrueCar found incentives averaged $2,432 per vehicle in August, down from $2,688 in July and $3,969 in August 2020. August's incentives were 6.3% of transaction prices, compared with 7% in July and 10.9% a year ago.

TrueCar forecasts that 3.7 million used vehicles will be sold in August, up 6% from a year ago and about even with July.

The average interest rate on new vehicles is 4.6% and the average interest rate on used vehicles is 7.4%. The average term was 70 months on either a new car or a used car loan in August, according to TrueCar.

Credit unions have been losing share based on the value of total car loans.

New car lending has been declining at credit unions even during the peak May-through-October buying season. CUNA Mutual Group's Credit Union Trends Report released Tuesday showed new auto loan balances fell at a 3% SAAR from May to June, while unadjusted balances for used cars rose 1.2%.

The Bureau of Economic Analysis on Friday reported that disposable personal income rose 0.7% from June to July after inflation. BEA attributed part of the increase to households starting to receive benefits from advance Child Tax Credit payments authorized by the American Rescue Plan.

"The estimate for July personal income and outlays reflected the continued economic recovery, reopening of establishments, and government response related to the COVID-19 pandemic," according to BEA's news release.