By on August 25, 2011

Michelle Krebs and Lacey Plache of Edmunds.com, decorated heroes of the TTAC “rate the analysts” contest (to be repeated) are raining on the parade of good sales forceasts, definitely for August, possibly for the year. Edmunds thinks that August sales will be flat. Customers are hearing mixed signals, and being confused, they do nothing. Says Lacey Plache:

“Stronger buying conditions are telling consumers to go ahead and make their car purchases, but a weak economic landscape is telling them to wait until later this year, or even longer. This is the battle that will determine exactly how much the auto industry will grow this year.”

For August, Edmunds expects car and truck sales to come in at a smidgen over a million (1,087,000 FWIW), up 2.6 percent from July and 9 percent from August 2010, not adjusted for the different number of selling days in the months. If that number prints, the Seasonally Adjusted Annualized Rate of car sales (SAAR) will stand at 12.3 million vehicles. “Stand” is the operative word, because is would be roughly the same as July.

Like us, Edmunds.com has its sights on underestimated Nissan. Edmunds gives Nissan ”the biggest month-over-month gains among the top six automakers. Nissan is projected to sell 10.4 percent more vehicles in August than July, and 21.5 percent more vehicles than in August 2010.”

Like us, Edmunds praises Nissan for dealing best with the obstacles thrown up by a huge tidal wave in Japan. Says Jessica Caldwell:

“Nissan’s market share growth is a testament to how well it has recovered from the March earthquake compared to its chief Japanese rivals. In recent marketing campaigns, Nissan has been directly targeting shoppers who have trouble finding Toyota and Honda vehicles in stock, while further enticing them with juicy incentives like zero percent financing on a majority of their models.”

On the overrated side, Edmunds forecasts that Ford will be the only major automaker this month to report a decline in sales from July to August. Ford’s sales are expected to be down 0.5 percent from July, leading to a market share loss of 0.5 points. Edmunds sees Ford struggling with inventory, notably of its hottest-selling models – the Ford Fiesta, Ford Focus and Ford Explorer.

Hyundai is expected to sell 60,839 vehicles this month, a 13.5 percent gain over August 2010. Hyundai’s inventories also show signs of strain. In early August, Hyundai’s CEO John Krafcik told Edmunds that Hyundai had only 37,000 vehicles in inventory – barely a 20 days supply. The Elantra was down to a 3 days supply.

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8 Comments on “Edmunds Traffic Forecast For August: Stop And No Go...”


  • avatar
    highdesertcat

    Very interesting article. Thank you, Bertel. Agree with the strain on Hyundai inventories, especially on the West Coast. All too evident there.

    On the Toyota side, sales of 2011 Camry have almost dried up now that the preview of the 2012 Camry has been released. Someone once commented that people are holding off buying a new Camry until the new 2012 comes out. They were spot on! Jim Lentz should be smiling.

    Well, I believe a lot of people are holding off buying a new car these days because of all the uncertainty. Only people with money and a steady job are buying new cars these days, if they have good prospects for the future. Many people worry about the reset of their ARM on 1 October 2011 and 1 January 2012. That’s got to be a game changer.

    Of interest may be that some new car dealerships in Texas are adding sales staff while some new car dealerships in California are cutting sales staff. And FWIW, some of those unemployed California car salespeople are actually moving out of California and moving to Texas to find work as car salespeople there.

    Could it be that new car sales in Texas are booming? If so, that could have a positive effect on the SAAR. Large state. Large sales numbers.

    • 0 avatar
      mike978

      The gap between the 2011 and 2012 Camry was pretty short since Toyota has the good practice of releasing photos and details about a new car when it is almost in the showroom (much better than other companies who tease for months). It may explain a part of the 2.7% drop but that is a large drop.

      Hurricane Irene will also have an effect since alot of the East coast people are thinking of preparing for that and not buying a car, especially since weekends are the big sales times.

  • avatar
    NormSV650

    Chrysler is coming on strong and consistent and looks to knock Toyota down another knotch for 3rd for the year. Ford is dithering along with no product when the others are trickling along and looks to have better to take a bail out like the others.

    With US POTUS campaign basically in full swing, the term “election year” is too short sighted these days. Stock market responding quickly to poor economic conditions it might be 2013 until the dust settles on forecasting auto sales.

  • avatar
    plee

    The two new car showrooms I was in with my son last weekend in the Nashville area were full of customers and people doing business. They were a Mazda and a Ford dealership. The Ford salesmen had multiple customers each. Hope that is a good sign.

  • avatar
    VanillaDude

    Who survived the Great Depression, and why?

    Whatever they did to succeed, they will need to do so again.

    2012 doesn’t look much better. And neither does 2013.

  • avatar
    highdesertcat

    Agree that, from my perspective and location, 2012 and 2013 don’t look much better than 2011. But we have to hope that the US auto industry, and especially GM, does well for it is the only way for we, the people, to get some of that money back that we showered on them during the Great Bailout.

    We already know what we lost on what was once called Chrysler, and what it took to get Fiat to take that loser off our hands. I learned yesterday that the US Treasury has already made more than $150B on the financial industry/banks it bailed out, and there’s still more to come. That’s the good news. But in the case of the US auto industry we, the people, will never recoup all the money that was wasted on failed giants, just to keep the UAW working at the expense of the tax payers. Somehow the UAW felt it was owed them because the taxpayers enjoyed the privilege of having the UAW build cars for them. I never understood that. But it was a great deal, for them!

    What helped turn America around after the Great Depression was the onset of WWII. Everybody who wanted a job, got a job. In fact, labor was in such short supply in 1942-1944 that it was imported from Mexico and anywhere else we could find people to come to the US Mainland. Many of them overstayed their welcome and didn’t go home. Some even came here involuntarily, like the Issei and Nissei forced to relocate from Hawaii.

    While we have a dire need for certain jobs in America, we do not want to repeat the factors that created jobs after the Great Depression. We already are involved in too many wars that will not yield any return on investment to the tax payers. WWII yielded enormous returns on the taxpayers’ investment. Iraq, Afghanistan and Libya are, and will always be, losses to the US taxpayers and the Treasury.

    It may come as a surprise but there are many, well-paying jobs in America that go unfilled these days because we don’t have the talent to fill them. That’s why, even today, we import people from overseas with our various visa-programs to fill those jobs that are critical to America. To wit, jobs in research, medicine and engineering.

    It’s a sad day when America has to import brains as well as manufactured goods. Yet we are doing it.

    Until the economy, and the housing industry, gets better and improves the lives of Joe Sixpack and Sally Housewife, fewer people will feel inclined to stick themselves in debt to buy that new car.

    I envision a depressed SAAR of 12.1M for 2011. It’s too early to tell about 2012 but I would be surprised if it is much higher. Economic forecasts are for very slow growth for two to three years.

    • 0 avatar
      mike978

      The financial bailout is still at a loss if you include the $180 billion to AIG. Some money was made loaning to Goldman Sachs etc but AIG was the big loss.
      GM will be a small loss through to breakeven. Chrysler was a small loss.

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