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July Car Sales Look Promising – But Japanese Shortages Remain a Problem

Market showing signs of increasing consumer confidence.

by on Jul.22, 2011

Business is picking up at U.S. showrooms.

Things are beginning to look more promising in the U.S. automotive market after an unexpected downturn heading into the normally robust spring-summer buying season, industry analysts say.  But the pace of preliminary July sales still are lagging behind the more robust automotive recovery seen earlier in the year.

July is likely to come in well ahead of year-ago levels, and will be a definite improvement over May and June 2011.  But the current sales rate – if averaged out over the full year, would fall just short of 12 million vehicles.  Until the mid-spring downturn, the U.S. market seemed on track to top 13 million.

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“Consumers continue to face obstacles in their willingness and ability to purchase a new vehicle,” cautioned Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “The ongoing debate regarding the debt ceiling and stagnant economy are creating added pressure on top of a generally weaker vehicle sales environment.”

Total light vehicle sales for July, Power predicts, will come in at just short of 1.1 million units, an 8% year-over-year gain.  The retail portion of the market, at 913,000, will be up a similar amount.  Adjusted for seasonal fluctuations, that would work out to an annual total of 11.9 million vehicles, at the current pace, or 9.8 million sold at retail.  Earlier in the year, numbers approaching 13 million were readily being quoted.


Detroit, Korean Makers Are Likely Winners as Car Sales Rebound

New study also warns that small car sales may be limited by America’s obesity epidemic.

by on May.17, 2011

Products like the Ford Focus could pick up share from Japanese makers as the American market recovers, says a new study.

Despite the shortages facing Japanese automakers like Toyota and Nissan, the U.S. new car market appears poised to experience steady sales growth after one of the worst downturns since the Great Depression.

But this rising tide, at least, won’t float all boats equally, cautions research firm A.T. Kearney.  It  predicts 13.2 million new autos will be sold in the U.S. this year, a roughly 50% increase from the depths of the 2009 downturn.  But as many as two points of market share once controlled by the Japanese carmakers could be up for grabs in the next few months – with Detroit and Korean makers in a good position to benefit at the expense of their struggling rivals.

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A variety of factors, including fuel prices, could impact the pace of the recovery, while also determining the sort of vehicles American motorists consider, the study indicates.  But those who expect a big gain for small car sales could come up short, Kearney analysts warn, pointing to America’s obesity epidemic.