JD Power has lowered its forecast for US light vehicle sales in 2011 and 2012, as the slower recovery is expected to extend into next year.

It now expects 2011 volume of 12.6m units, up 9% on 2010 but down from the previous forecast of 12.9 million. Retail light vehicle sales are now forecast at 10.2m units for 2011, down from 10.5m.

For 2012, the outlook for total light vehicle sales has been reduced to 14.1m units from 14.7m with retail volume now at 11.5m units (from 12m).

“The economy and automotive industry continue to wrestle with a series of unsettling developments, which are now likely too strong to overcome within 2011,” said John Humphrey, senior vice president of automotive operations at JD Power.

“While it is not time to hit the panic button, it is clear that ascending from the recession is proving to be just as bumpy as the decline into it, and a full recovery in vehicle sales is further down the road than previously thought.”

The August SAAR rate is 12.1m, JDP added.

Light vehicle production in the North American region has increased by 8% through the first seven months of 2011 from the same period in 2010, with volume of 7.3m units. At the country level, production in Mexico is showing the strongest year-over-year change, rising 16% with the addition of the Fiat 500, Ford Fiesta and new VW Jetta models. The US follows Mexico with an 8% increase, while volume in Canada is off 1% - hurt by production losses from Honda and Toyota.

Vehicle inventory has decreased to a 49 days’ supply at the beginning of August, down from 54 days in early July, mainly due to the typical July shutdown at many of the assembly plants last month. Car inventory was at 40 days, while truck supply was at 58 days - both low for their respective norms.

JDP has trimmed its 2011 North American production outlook slightly, but it continues to round to 12.9m units. The decrease is the result of the reduction in the outlook for vehicle sales, but it is not as severe due to the current low level of inventory. Had the sales pace returned to the strength shown at the beginning of 2011, production would have needed to be increased in order to meet the demand and replenish inventory levels by the end of the year.