U.S. Back To Its 17 Million Glory - In 5 Years
In the beginning of the new millennium, U.S. new auto sales topped 17 million a few times as Americans used the assumed equity in their houses to stuff their three car garages with more cars than there were driver’s licenses in the nation. In 2000, a total of 17,349,700 new cars changed hands. A year later, 17,121,900 units. It deteriorated from there. In 2007, 16,089,300 cars were sold. And we know what happened thereafter.
If we buy and sell 11.5 million new cars this year, it will be called a recovery. For 2011, J.D.Power sees maybe 12.8 million, if it all works out. They had seen a bit more before, but grew cautious lately. Now, a prophet appeared that predicts the miracle everybody prays for, a return to former (albeit fleeting) glory:
Michael Robinet, director of global production forecasts for IHS Automotive, said that U.S. new car sales could top 17 million by 2015. “That would be a huge reversal from the historically low sales levels that brought the industry to its knees during the recent recession,” even Detroit’s hometown paper, the Freep, has to concede.
At a presentation made in front of the rapt audience of the Automotive Press Association in Detroit, Robinet counted down the usual number of reasons: Pent-up demand, a growing U.S. population and aging baby boomers with discretionary income.
Robinet agrees with J.D Power and expects sales of 12.8 million or more next year. Then his charts jump to 16 million in 2013 before reaching 17 million in 2015. Of course, he keeps a little hedge. High gas prices over an extended period of time could suppress vehicle sales, Robinet revealed. Who would have thought.
There is just one fly in the ointment. Prophecies by IHS don’t have a stellar track record. Remember a year ago, when a respected research company had announced in November 2009 that Volkswagen had overtaken Toyota in worldwide sales and would end 2009 as the world’s largest automaker? The announcement had emanated from IHS. It made headlines the world over. It was total bunk.
Toyota ended that year as GM was and Volkswagen #3. IHS had made a total mess of the numbers, had forgotten to count Daihatsu, Hino, Audi and sundry others, prematurely put Porsche into VW’s 2009 numbers, and overlooked one simple fact. According to their (wrong) calculations, Volkswagen had sold more than 4.4 million cars by November 2009, “beating Toyota by more than 400,000 vehicles.” It didn’t dawn on them that you can’t possibly be the world’s largest if you had only sold 4.4 million by November. Toyota sold 7.2 million that year, GM 6.5 million, and Volkswagen 6 million.
As much as we wish the glory days to return: Beware of false prophets.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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I long for the Cold War days when USA kitchens were paraded before Khrushchev as being far superior to cold, minute, sterile USSR kitchens and that USA kitchens, and the equipment within, were the envy of the world. Of course, to allow those USA kitchens to properly function required an extensive properly functioning infrastructure of various inputs such as electricity, natural gas, potable water, waste riddance, etc. If the ChiComs ever commence the braggadocio regarding their conveyance output we merely need to compare and contrast the quality of dumpster dining our underclass has at hand to what is assuredly the inferior vittle quality and quantity available to China's outcasts, those unable or incapable of obtaining required calories for sundry reasons. I omit any suggestion of comparing China's conveyance housing/storage capabilities with that of the USA since I fear with time and the continued economic woes accompanying what I believe will be a permanent class war within the USA that a plethora of USA garages will be converted into living units as so often seen in areas of California with very high numbers of undocumented future citizens. Heck, during the economic downturn of the early 1980s I hanged the proverbial hat in a portion of a typical tract home garage and used the facilities inside the house as needed, departing the innards of the abode when finished.
Unemployment went up today to 9.8%. It has to get back to the 5% range if you want to see car sales pick up. Tell me when that is going to happen.