By on April 16, 2011

Checking dealer transactions for the first half of April, Edmunds sees cars selling at a fast clip. Dealers are all smiles: Average prices are going up, cars are flying off the lot, and the “average days to turn”  – industry speak for the time the dealer sits on a car until it moves – fell more than 10 percent since the beginning of April, from 58 days to 52. If the rest of April behaves similarly, Edmunds sees a seasonally adjusted annual rate (SAAR) of 14.1 million in April. Party time. The festivities could be premature, Edmunds warns.

First off, Edmunds.com projects a slowdown in the latter part of April that will bring the April SAAR closer to 13.1 million. Edmunds thinks that the current rush is a flash in the pan: “It seems there has been a rush of consumers anticipating a shortage, and most of those sales are likely behind us,” said Ray Zhou, senior analyst at Edmunds.com. “Inventories will soon get leaner, too, as production stoppages in Japan won’t allow dealers to restock as quickly, and that may cause some consumers to delay their purchases.”

Edmunds.com still projects 12.9 million new car sales in 2011, with a lot of hedging.  “Even a moderate impact on production for Japanese automakers that lasts through most of the summer could lower new car sales to 12.6 million, and a more severe impact could push sales down to as low as 12.2 million,” said Edmunds.com Chief Economist Lacey Plache.

So there you have it. Pick any number you are uncomfortable with.

 

 

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20 Comments on “Edmunds: Brisk April Sales Could Be Flash In The Pan...”


  • avatar
    eldard

    This could only push gas prices up. Oh, I love it!

  • avatar
    Dimwit

    I’m not seeing the panic from high gas prices yet. Give it time. I figure by the fourth quarter the pentup demand and, hopefully, the Japan issue sorted, the market will takeoff on all the small fuel efficient brands.

  • avatar
    thetaII

    Nice Bill Heard reference, by the way.

  • avatar
    dwford

    I definitely see more people coming in looking for the mpg number first, but not a panic rush yet. People are still trying to get giveaway prices on hot cars with top $ for their low mpg trade. Dare to dream.

  • avatar
    findude

    We’re actually thinking about buying a new car soon, but it seems this is a lousy time to get a good deal with inventories relatively low and little chance of a good deal on a nice high-mpg vehicle.

  • avatar
    John Horner

    Edmunds has a terrible track record of prognosticating what is going to happen next with auto sales. Remember when they said that the clunkers scrap incentives in the US were going to lead to a sales plunge after that program was over? It didn’t happen that way, and almost nobody called ’em on it.
    Media forecasters love to say what they think will happen, but rarely are held accountable when they get it wrong.
     

    • 0 avatar
      doctor olds

      @John Horner- Great post!

    • 0 avatar
      thornmark

      Wrong!

      New Data Raise Fears of a Post-Stimulus Hangover

      Washington Post Staff Writer
      Friday, October 2, 2009
       

       
      The fragile economic recovery has relied heavily on government stimulus spending, but new data show that as the money runs out, a sustained rebound may be elusive.
      The dramatic decline in sales reported Thursday by the Big Three automakers suggested the extent to which the stimulus act has propped up the economy. The government’s wildly popular “Cash for Clunkers” program drove consumer spending to its highest level in eight years in August. But after it ended, so did the growth in auto sales.
      General Motors’ sales plunged 36 percent in September compared with August. Ford plummeted 37 percent. Chrysler dove 33 percent.
      Cash for Clunkers “was a one-time boost of sales followed by a crater,” said Ben Herzon, an economist at Macroeconomic Advisers. The firm forecast that the program was likely to have no effect as a stimulant for national economic output….
      http://www.washingtonpost.com/wp-dyn/content/article/2009/10/01/AR2009100103098.html?hpid=topnews&utm_source=Newsletter&utm_medium=Email&utm_campaign=Morning%2BBell

    • 0 avatar
      Steven02

      Ford Death Watch anyone?

  • avatar
    doctor olds

    Americans are starting to choose cars over trucks by a small margin, 51.7% to 48.3% in March, though trucks still haved the edge, 50.9% to 49.1% for Q1 2011. 

    The F150 surged 42% from Feb to Mar, and drove Detroit 3 full size truck sales up 20% in aggregate, beating the whole industry, which was up only 16.7% 

    The high price of gas does not seem to be having a dramatic effect yet.

    • 0 avatar
      eldard

      If gas prices continue to go up, June 2008 will soon have deja vu. When Civic beat the F150 in sales.

      • 0 avatar
        John Horner

        The way I see it is that the events of 2008 pushed people out of trucks who didn’t need trucks. We had a decade or so when trucks were suddenly fashionable, and many were being bought by people who had no real need for them.
        Now the truck market seems to be back to those who really need a truck for their business or their personal passions (horses, boats, etc.). The fashion buyers have either moved on, gone broke, or both. Today nothing screams being oh-so-out-of-style as a guy in baggy pants, a girl showing off her thong, or anyone driving a Hummer.

      • 0 avatar
        vento97

        Don’t worry – these individuals will feel the PAIN in their wallets soon enough.  But by that time it will be too late and they will have to live with their ill-advised decision for the duration of the lease or note – provided they aren’t financially underwater, that is…

  • avatar
    AJ

    Last thing I want in this economy is a new car loan. My wife wants a new Grand Cherokee but I don’t want to be stuck to those payments for five years. Forget it and she can keep driving her older Jeep… Less to worry about should one of us end up unemployed.

  • avatar
    nrd515

    I can’t believe the panic I’ve seen in friends of mine over gas prices, but yet they have no problems spending insane amounts of money in bars for overpriced drinks and crappy food, night after night. He and his wife work together and hit the bars constantly. One less night a week (5 instead of 6) after work at the bar, and they’ve more than paid for ALL the gas they use that month, even at $5/gal. One of my other friends spends a ton of cash on sexcams, and yet he is looking to buy a tiny car he doesn’t really fit into (6’4″ and 250+ pounds) because gas is “too high”. He wastes $3.00 a minute on the webcam pages, and says gas is too high?? LOL.

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