Edmunds: U.S. Car Sales Set to Slip Below 10m P.a.
The U.S. new car market is officially dead in the water. Well, not officially officially. As the UK’s Guardian points out, December’s best selling days are its last. But the paper quotes Edmunds projection for the month’s sales, and it’s an unmitigated disaster. Edmunds expects December auto sales to crater to 9.8m units. “That would represent a further decline from 10.2 million units in November, which marked 26-year lows.” Sales analyst Jesse Toprak expects U.S. new vehicle sales to fall by more than 38 percent in December. More specifically, “Chrysler… is expected to lead the industry decline with a more than 45 percent plunge in December sales… while GM sales are seen down 39 percent and Ford sales down 34 percent. Toyota Motor Corp, Honda Motor Co and Nissan Motor Co are all expected to report declines of about 40 percent.” BarClays Capital analyst Brian Johnson predicts bad things for Detroit’s hometown hero. “We continue to see little equity value in the restructured GM. A greater decline in sales raises the possibility for additional funding needs.” Any guesses who pays that bill?
More by Robert Farago
Comments
Join the conversation
"… while GM sales are seen down 39 percent and Ford sales down 34 percent. Toyota Motor Corp, Honda Motor Co and Nissan Motor Co are all expected to report declines of about 40 percent.” So why are the three transplants down more than GM or Ford? Was it that a year ago the domestics were already tanking but the transplants were doing well, or that F-150s and Silverado sales have picked up as the price of gas fell?
Menno is on the same page I am regarding 2009 sales. A few weeks ago, I thought that maybe the US would maybe crank out 10MM if the stars aligned properly. The more the numbers come out, the more I think that I'm going with the 6MM or less number for '09. Yes luscious, credit as practiced in our economy is a (theoretically) carefully controlled house of cards. For every dollar a bank has on deposit, they can loan nine. Beyond the pile-o-bailout cash, the Fed has quietly loaned 2 Trillion on an 'emergency basis'. They won't say to which institutions. Wanna take bets on how much of THAT gets paid back?
Hearken back to early in 2008, when TTAC asked the best and brightest the eternal question, "New or Used." We have a glut of used cars, so prices are low. Peoples expectations about what a vehicle is for (i.e., reliable transportation, not transpo-tainment and ego massagery) so people are just not going to be inclined to blithely walk into a dealer and sign up for 6 years of debt on the biggest, fastest bauble they can find....and banks are redlining and loaning only to superior credit scores. People will only buy a vehicle if forced to by failure or destruction of their current ride. This adds up to new vehicle sales between 6-7 million, or a 50% reduction of a couple of years ago. Used car sales, on the other hand, will be not as bad, as many former new buyers will be looking for good deals on used iron. New car demand will not see 10 million units in the US until 2011, until the glut of used cars is soaked up. I'll be back next year to pick up my Cassandra award.