September Auto Sales Expected to Drop

Industry’s September Song Will Be a Blues Number

By Brendan Moore

10.01.2007

Monthly results from all the automakers for September are due out tomorrow, and they’re probably not going to be pretty.

Everyone is expected to take a hit, with the only positive exception being Honda, as a result of the introduction of the 2008 Accord last month.

In fact, most industry analysts think September 2007 will be down as much as 4% from September 2006, which means that 2007 calendar year will then be trending at 15.9 million new vehicles. Compare that to the 2006 total of 16.6 new vehicles sold, and the 2005 total of 16.9 million units retailed, and you see the reason for concern. If sales go below 16 million annually, 2007 will be the worst year for auto sales since 1998. The highest year for sales in the U.S. was 2000, when the car companies sold 17.3 million vehicles in the U.S., at the height of the SUV fad.

A combination of higher fuel prices, economic uncertainty, a credit crunch, the housing bust, and other factors are all contributing to the lower sales figure, and it doesn’t look as if the rest of 2007 is going to be any better. As has been the case all year, Ford is expected to take the worst of it in September, with sales declines that could be in double-digits. GM sales are expected to be flat with the short UAW strike having had no effect on their retail situation, and Chrysler will probably have a slight decrease. Projections regarding tomorrow’s figures get a lot cloudier as we look at the other imports besides Honda, but Toyota and Nissan, the other big pieces of the Japanese puzzle, are expected to show decreases in retail sales tomorrow.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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4 Comments

  1. I didn’t realize that SUVs were a “fad”. Even though sales are down, SUV sales are still pretty respectable. I love my SUV, and so do many other millions of SUV owners. It’s flat wrong to dismiss our buying choices as participating in fad behavior. I made a decision about what kind of vehicle was best for me, and bought it. End of story. It wasn’t impulsive and I wasn’t affected by the marketing of SUV’s. I will be driving a large SUV until I stop driving, no matter how many snide remarks people like you make about people like me.

  2. Larry, take an aspirin or something, would you? You’re taking this way too seriously. And as far as qualifying as fad, I think that statement is justified. Millions and millions of men bought leisure suits in the seventies, and some of them really enjoyed wearing those suits, but now, people just kind of laugh it off as a mild form of mass hysteria. Remebr the surf music fad, the folk music fad, the disco music fad, etc. The millions of people that bought those records all enjoyed those fads, too, but those fads passed as well. How about “Who Wants To Be A Millionaire”? Millions and millions of people were glued to their sets, but the bloom was off the rose after awhile, right? It’s the same with SUV’s. There will still be people driving around big SUV’s that they don’t need five years from now, but not many. Ten years from now it will be even less. The peak has passed and it’s all dowhhill from here in terms of SUV ownership. But that shouldn’t prevent you from enjoying the heck out of your current SUV and your intended future SUV. You knock yourself out.

  3. One word: tailfins.

    Equally useless to most drivers in the 1950s as an SUV is today.

  4. I wonder why Toyota would take a hit. thye have a lot of cars with good gas mileage

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