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JD Powers Forcasts 15% Sales Decrease for August

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On: Mon, Aug 23, 2010 at 9:23AM | By: Sherry Christiansen

JD Powers Forcasts 15% Sales Decrease for August

According to a recent J.D. Powers and Associates poll, the vehicle sales record for August is expected to decline from July’s numbers which were “relatively strong.” Total sales for light vehicles are expected to be down 15% from last August when numbers were high as a result of the “cash for clunkers” government incentive program. But numbers will remain above that of the selling rate from the first 6 months of 2010.

August sales are expected to be around 875,000 units, which, according to Automotive News, “represents a seasonally adjusted annualized rate (SAAR) of 8.9 million units.”
August sales are expected to diminish slightly from July's reported rate of 9.2 million units. These numbers represent the most accurate predictor of the demand for new cars in the country.

When analysts factor in the distortion rate from the “Cash for Clunkers” program, the actual numbers are up by 14% from August of 2009.

Light vehicle sales are also expected to be down from last August (15% lower), also as a result of the effect that the federal Cash for Clunkers program had in August of 2009. The August rate of fleet sales activity, however, is up by as much as 300,000 units from July of this year. Fleet sales, in general, account for 17% of total automotive sales this year, which is down from last years’ number of 22%, but quite a bit higher than last year when fleet sales accounted for only 9% of total sales.

J.D. Powers and Associates has had to revamp its forecast for 2010 to account for the lower August numbers; as it stands today it looks like the projected grand total for the year is around 9.2 million units for retail sales and 11.6 million units for total 2010 sales, down from 2009, with a year-end total retail sales of 9.4 million units and total sales of 11.7 million.

The slow recovery of the automotive industry is projected to continue into 2011; J.D. Powers has revised its 2011 forecast down to 10.7 million units for retail, and 13.2 million total sales for the year.


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