J.D. Power Predicts Strong March, Sees Production Trouble Ahead
J.D. Power sees a strong March in its crystal ball, powered by real-time transaction data of 8,600 retail franchises throughout the United States. However growth is expected to be much more sedate than the 27 percent jump in February.
In its March forecast, J.D. Power expects total light-vehicle sales for March to come in at 1,205,200 units, 9 percent higher than in March 2010. Fleet sales in March are expected to decrease to 213,000 units, “based on the expectations that Japanese manufacturers will reduce fleet sales and channel that volume to the retail market, due to concerns about inventory shortages.” J.D. Power projects the March SAAR at 12.7 million units. They keep their forecast for total vehicle sales at 13 million units, up 13 percent from 2010.
Power sees near-term production to be impacted by parts shortages caused by the earthquake and tsunami crisis in Japan. “With the uncertainty remaining high about the full extent of the parts supply situation, North American production could be impacted in the weeks to come,” said Jeff Schuster, executive director of global forecasting at J.D. Power. “However, our 2011 production forecast remains at 12.9 million units, as we expect any lost volume would be made up later in the year.”
J.D. Power and Associates U.S. Sales and SAAR ComparisonsMarch 20111February 2011March 2010New-vehicle retail sales991,900 units
(12% higher than March 2010)2785,698 units849,735 unitsTotal vehicle sales1,205,200 units
(9% higher than March 2010)991,576 units1,064,072 unitsRetail SAAR10.9 million units11.1 million units9.3 million unitsTotal SAAR12.7 million units13.4 million units11.7 million units1Figures cited for March 2011 are forecasted based on the first 17 selling days of the month.
2The percentage change is adjusted based on the number of selling days (27 days vs. 26 days one year ago).
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I haven't seen any comments regarding the possible upside of this -- but, it seems to me that a supply shortage would -- decrease supply -- and likely increase prices. what better chance do our home boys have to reduce incentive payments, reduce fleet sales, sop up extra inventory, etc? There has to be some pent up demand, used car prices are pretty decent as well as interest rates, so the net effect on the consumer may be moderated. I'm sure that there are financial costs to be borne but -- the idea that with less inventory that the dealers could actually get more money per sale sounds favorable to me. But what do I know -- not being a car expert.