Edmunds Sees Strong January, Is Worried About Fuel Prices
January 19th, 2011 4:02 PM
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Despite rising gasoline prices, January shapes up to be a very strong month for car sales. Edmunds.com Chief Executive Jeremy Anwyl told Dow Jones Newswire that the seasonally adjusted annualized rate (SAAR) for the month was looking “very strong” at 12.8 million vehicles as of last week, and was higher than December. That is a surprise: January sales typically are lower than December sales.
Edmunds sees Kia the biggest winner so far. BMW is taking it on the chin: A huge year-end sales event is taking its toll.
As far as fuel prices go, Edmunds thinks they could put a crimp into SUV and truck sales that had a strong rebound last year. Remember: Big cars, big profit. Small cars, small profit.
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How does it work when you buy a car at the beginning of the month but it's still part of the month before as far as sales figures go? For example I bought a Toyota on Jan 3rd, the last day of the Toyotathon event, the dealer was telling me that the sales through the 3rd in this case actually count towards 2010 totals. I've seen other events like this that go just past the end of a month... Are all sales counted on the day or month they are completed or do they effectively "backdate" things? Or is it conceivable that different people count the same sale two different ways (or even twice?)
The ignorance afforded to buyers is very frightening to me. People still buying trucks after 4 dollar gas prices happened. My car only get 19mpg, but I payed $2k for it. Perhaps I'll switch to a Corolla soon.
"Apparantly the 2011 Chrysler minivans are not out yet and the dealers are still clearing out the leftover 2010′s." Didn't know you couldn't buy a 2011 T&C yet, but I know you can rent one. I did about a month ago, not that I was looking for a mini-van but National was renting 2011 T&C's for $23 a day, far better deal than anything else that they had to offer. It was loaded to the gills; the sat radio was an unexpected feature. I have never owned a mini-van and can't imagine ever doing so but I have to tell you this thing was nice. Drove & rode beautifully, great road manners. The interior was also a new high-point for Mopar. I would imagine the need to deep discount Chryco's like these through incentives will dry up somewhat when these are publically available.
The problem with high gas prices has nothing to do with MPG. The problem is that it will force families to cut further back on spending of all kind, which will take them out of the car market completely. We are no longer talking about people switching cars from gas guzzler to mini car, we are talking about bankrupted families paying off their household debts and discovering that whatever they are driving is going to cost more to drive. The fiscal crisis is far worse than a mere car switch. Trucks will still have a market. Big vehicles will still have a market. The reality is that you can put more people in a big vehicle than a little one and that isn't going to change. There isn't any reason to believe families will stop towing things. There isn't any reason to believe that the demand for these vehicles will dry up because of gas prices, just because we saw that happening in the past. We face today a far worse situation economically than we have faced since 1933. Gas prices will prevent car buyers from BUYING anything. Expect inexpensive cars to be the chosen vehicles. Hyundai, Kia and cheap cars are going to be OK. Value is going to be more important in 2011 than MPG. 2011 will not be better than 2009 or 2010 in many ways. High gas prices will kill what little economic recovery we currently see.