Login to your account
Not a member? Register now.
AutoShopperBlog

Subscribe To The Blog:




Follow Us



The Latest News And Reviews
Throughout The Car Industry



U.S. Auto Sales Predicted to Be Low in June

Comments: Leave | View
On: Thu, Jul 1, 2010 at 12:06PM | By: Sherry Christiansen


U.S. Auto Sales Predicted to Be Low in June

The automotive industry in the U.S. is not looking like recovery will be just around the corner, in fact Bloomberg News reports that; “U.S. auto sales this month probably posted the smallest increase since February as consumers concerned about unemployment and the economy avoid large purchases.”

Forecasters predict that sales of cars and light trucks may have slowed in June after May’s improvement.  Automakers sold 1.1 million vehicles in May, the best month so far this year. J.D. Power and Associates, Truecar.com is predicting that June sales will drop below 1 million.

The decline is projected to be anywhere from 9.5 to 12% from May to June of 2010, final figures will be verified on Thursday, July 1st.

“Despite all the talk about things getting better, it doesn't seem that way in many people's homes or in their bottom line,” said Jessica Caldwell, at auto researcher Edmunds.com in Santa Monica, Calif. “It's going to be a tortoise-like recovery.”

Mark Fields, the president of Ford Motor Company in the U.S., reports his take on the situation, Fields states that the problem is a result of too many American consumers who are not in a position to make big purchases because of the unemployment rate, currently at 9.7 percent, as well as loss of equity in real estate. Ford dealers and analysts feel that the buyer’s “confidence is keeping them out of showroom.” In fact the traffic in many dealerships is reportedly down by as much as 20%.

Consumers are leery to commit to a 3 or 4 year contract of new car payments, many are playing it safe, and continue to drive their old cars for another year until job security increases.

“The consumer is feeling a bit better, but not enough to go out and go back to the old ways of spending,” Fields said last week. “It gives us pause because of the tight labor market and the overall situation in the credit markets.”

One factor that dealers face is lack of inventory, according to J.D. Power, car companies are seeing less and less inventory in the months of May and June, “lower than the two month’s supply once considered the industry’s standard.”

According to Bloomberg news, Gordon Stewart, owner of 4 Chevy outlets across the country stated; “We could sell more cars if we had them, but Detroit is being very conservative in its build,” “We've had a drop off in traffic, but when somebody does finally come in, you don't have a car to sell them. It's like a double whammy.”

The good news is that new car buyers may see the return of some great incentives next month as automakers strive to boost their sales for the remainder of the year.




Comments

Be the first to leave a comment.


Leave A Commment

Allowed HTML tags: <a href=""> <abbr title=""> <b> <em> <i>
Please no link dropping, no keywords or domains as names; do not spam, and do not advertise! rel="nofollow" is in use

Captcha