Auto Sales Continue to Follow the 2017 Declining Path

 
Auto Sales Continue to Follow the 2017 Declining Path

by Amy Lignor

 

It was only last week that forecasters expected to see a very small increase when it came to U.S. auto sales for August vs. the same month a year ago. As always when it comes to the marketplace, although that very small increase will occur, once it’s adjusted to account for the one extra selling day in August, 2017 vs. 2016, the increase actually will turn into yet another very small decline – which stays on track with the previous seven months of continuing small sales declines.

U.S. auto sales, LMC Automotive, J.D. Power, politics, natural disasters, unemployment, Kelly Blue Book,

This is not the yellow brick road; there is no path in 2017 that will allow auto sales to come alive. Which is unfortunate, considering the auto industry desperately needs a magical world of Oz right now. Truth be told, with the political landscape being what it is, and Mother Nature adding her pain and agony into the mix with the recent tragic hurricane, there will be less and less people running out to invest in an automobile or truck of any kind to round out the year.

 

J.D. Power and LMC Automotive were expecting unit sales of just over 1.5 million to be reported in August (which would be an increase of just under 1% from August, 2016.) However, adding in that extra “selling day” (27 vs. 26 days in August, 2016) is why J.D. Power and LMC Automotive must consider any wee increase to be transformed into yet another decline, based on the average daily selling rate. Without adjusting for selling days, Kelly Blue Book stated that August sales would increase 1.5 percent year-over-year; whereas Edmunds.com forecasted figures up 1.3 percent from last year. In other words, the forecasters can still be relied upon as much as the NFL experts can be for their predictions.

 

When it comes down to brass tacks, for the U.S. auto industry, any improvement in August sales would be welcome. Through the end of July, U.S. auto sales for 2017 were down 2.9 percent. For the month of July only, auto sales were down 6.9 percent. Money is what the industry wants to see, yet when you further break down the figures, what they are seeing is the fact that consumers who decide to actually spend their money on transportation are moving away from cars to trucks – specifically the smaller, car-like “crossover” SUVs.

 

When looking at four-door sedans, two-door coupes, convertibles, and traditional station wagons, the numbers just aren’t there. The 12% decline in these categories brought the marketplace down, while light truck sales were up 4% and accounted for about 63% of total U.S. auto sales year to date.

 

When looking ahead to what the end of the year tallies will bring, LMC Automotive has not changed their thinking in the least; they are sticking to a forecast of U.S. auto sales ending at 17 million, which would be down from a record 17.5 million seen in 2016. The saddest part about this for the industry will be the fact that if this does occur, 2017 will be responsible for breaking a record string of seven consecutive years of increases.

 

Reality is that things can turn on a dime. A political misstep, unemployment figures rising, natural disasters – you name it and it can occur – will directly affect the United States Total Vehicle Sales numbers. When looking even further ahead, without the benefit of ESP and knowing what’s about to come, forecasters are looking at numbers being around 18.7 million in the year 2020. Can we rely on this far more positive outlook? It depends on how big of a gambler you’re willing to be.

Source:  Baret News

 

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