An indecisive economy is forcing analysts to do a downward revision for auto sales for the balance of 2011 and 2012. J.D. Power and Associates today trimmed its estimate for 2011 light vehicle sales to 12.6 million from 12.9 million units, and its 2012 outlook has been cut to 14.1 million from 14.6 million units. Not much positive has happened since politicians got themselves in a debt ceiling tug-of-war. A battle neither side won and consumers were the ones that fell in the mud. An S&P downgrade was followed by a bi-polar stock market. And once the negative self-talk about the economy begins, unfortunately is seems to pick up steam rather than hit a rick wall, even though the balance sheets of most businesses are a lot better than they were back in 2008.
There's way too much talk of a double-dip recession as opposed to a vibrant butt-kicking economy humming on all cylinders. The last thing the radio industry needs now is a pull-back in automotive advertising, not when they are about to battle some very hefty political comps (see previous story) that will most certainly be hard to match. In a survey by The Wall Street Journal over the past week, 46 economists polled put the odds that the U.S. is already in another recession at 13 percent, while they peg the chances of another recession in the next year at 29 percent -- up from 17 percent only a month ago.
Here are some other stats (source: Automotive news)
- IHS Automotive reduced its estimate for U.S. auto sales in 2011 by 200,000 units to 12.5 million light vehicles.
- IHS analyst Rebecca Lindland said the forecasting group also cut its estimate for 2012 deliveries in the U.S. to 13.5 million vehicles, from 14.7 million.
- The Massachusetts-based researcher also lowered its estimate for light-vehicle sales in 2013 to 15 million, from 15.5 million.
- Light-vehicle sales rose less than 1 percent in July, spurring some analysts to lower their outlook for 2011 industry sales.
- JPMorgan Chase & Co. last week reduced its estimates for 2011 and 2012 by a combined 700,000 vehicle sales.
- General Motors and Ford Motor Co. -- citing signs of weaker economic growth -- recently indicated they expect 2011 sales to come in at the low end of a range of 12.5 million to 13.5 million units.
- Industry sales are up 11 percent this year through July, though growth has slowed in recent months because of inventory shortages following the March earthquake in Japan, rising gasoline prices and overall economic uncertainty.
- A drop in discounts and higher new vehicle prices have also discouraged some buyers, analysts say.
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