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Oops! U.S. June Auto Sales Down Further

Projections continue to point toward an ongoing decline.

by on Jun.30, 2010

Weakness in new-vehicle retail sales experienced during the first half of June has progressed at an accelerated rate through the remainder of the month, pulling the retail selling rate below 8.5 million units, according to J.D. Power and Associates.

Power had originally projected that new-vehicle retail sales were expected to come in at 768,000 units, which represents a seasonally adjusted annualized rate (SAAR) of just 8.6 million units. Final results from AutoData Corporation will be in late tomorrow.

Ups and Downs!

The difference amounts to about half of the annual output of a typical final assembly plant, not counting the negative effects on production of component parts, such as engines and transmissions at supporting plants.

Thus, the Global Great Recession continues as the U.S. Congress grapples with a bill to regulate the reckless practices of Wall Street, which crippled the global economy in the fall of 2008. Republicans oppose the bill.

In the week leading up to the close of the month, June new-vehicle retail sales were down 5% compared with one year ago. As fleet sales are not expected to change significantly, the total seasonally adjusted annualized rate (SAAR) may come in well below the 10.9 million units previously predicted by Power.

“It appears that the volatility in the stock market and downbeat economic reports have caused a decrease in consumer confidence, leading to a self-fulfilling prophecy,” said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “Consumers are clearly hunkering down in light of the current environment, waiting for signs of a renewed recovery.”

As a result, June new vehicle sales in the U.S. will drop significantly from what was a weak month of May with a selling rate of 8.9 million units.

However, this remains above a selling rate of 8.2 million units in June 2009. Retail transactions are the most accurate measurement of true underlying consumer demand for new vehicles, according to Power.

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5 Responses to “Oops! U.S. June Auto Sales Down Further”

  1. js says:

    “Thus, the Global Great Recession continues as the U.S. Congress grapples with a bill to regulate the reckless practices of Wall Street, which crippled the global economy in the fall of 2008. Republicans oppose the bill.”
    This is an uniformed opinion. The administration does not want the economy to recover. Otherwise they would pursue solutions which would foster recovery.

    • tdb says:

      Hi, JS,
      I have to echo Ken, and we often differ sharply on politics. The idea that the Obama Admin. might want the economy to suffer is convoluted logic even by Fox News standards. There is absolutely no political payoff without twisting things to the breaking point for justification. There is a critical election in November and under no possible reasonable scenario would the Democrats do anything but lose by not staging some form of recovery before November.
      Frankly, there are reasons why the Republicans would be willing to accept a downturn, though I write this cautiously and afraid that this will instantly turn my note into a seemingly partisan diatribe. But rejecting an extension of unemployment benefits just doesn’t make sense unless you are more interested in stirring up anger than actually doing the right thing.
      Paul A. Eisenstein

  2. wc says:

    Right on JS. And dont forget the urgent “carbon cap and tax” legislation that is on the coat-tails of the Wall Street regulation. That is sure to jump start the economy.

    • Ken Zino says:

      The logic suggested is that the Administration in an election year wants the economy to stay bad so it can suffer? There are policy differences to be sure, but not an attempt to hamper the recovery. – editor

    • tdb says:

      I should have added this: would you really prefer to leave Wall Street and the banks to do as they will? Are you more pleased with the way they have handled matters in recent years? I find that astounding, even from free-traders and the most dedicated followers of Adam Smith. The deregulation of the ’80s and ’90s, which was, incidentally, a bipartisan disaster, takes plenty of the blame for the current economic crisis and climate.
      Paul E.