Just ahead of official US results announcements, a top auto industry sales analyst has called 2008 at 13.5m units after 2.5m sales in the fourth quarter.
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George Pipas, Ford Motor’s chief sales analyst, told a media briefing that would be 3m fewer than in 2007 , noting that the market hasn’t collapsed that much in a single year since 1974.
That was when the effects of a Middle East oil crisis hit home, affecting auto sales world-wide.
Analysts have said December’s sales rate would probably be worse than even the 26-year lows reached in October and November.
“And since the early ’80s, there are 70m more people that can drive a vehicle,” Pipas was quoted as saying during the briefing. “So this is even worse per capita than 1982.”
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By GlobalDataSales of sport utility vehicles, which used to generate huge profits for the Detroit automakers, were down 51% in the three months to November, the International Herald Tribune said, while passenger cars outsold sport utility vehicles and other light trucks last year for the first time since 2000.
“In the late ’90s, our assumption was that light trucks could just continue, and would never turn back,” Pipas said. Now, “we don’t think passenger cars will ever look back again.”
Sales of trucks and sport utility vehicles were probably higher in December than in the preceding months, most likely even outselling cars, analysts told the paper, but that was primarily driven by big discounts on many larger models. The average value of incentives per vehicle was almost US$1,000 higher in December than a year ago, but on trucks the increase was nearly $1,500, Pipas said. Full-size pickup trucks were now being discounted by an average $7,000 to $8,000.
Edmunds.com said its site traffic for the last week of December indicated nearly a 50% increase in purchase intent and dealer price quote requests. Dealers reported that they did 40% of December business during the last week of the month thanks to an unexpected flurry of customers that left some dealerships short-staffed.
“Normally, I would say that such an increase in the last week of December is just at the high end of the usual seasonal pattern, but in the current environment I would say that it is dramatically good news,” senior analyst David Tompkins said.
General Motors especially benefited once its financing arm, GMAC, qualified to receive federal loans and started offering increased financing incentives to a broader range of consumers last week. Since that programme was announced, GM vehicle research increased 33% on Edmunds.com while all other automakers were up only 20%.
Reuters noted that key interiors and battery supplier Johnson Controls recently forecast overall US auto production down as low as 9.3m in 2009.
Pipas is predicting sales could reach 12.5m this year following a “modest recovery” in the second half.
“We are not looking for first quarter overall US sales to be much different than the fourth quarter,” he told the news agency.
“We might see [the] credit freeze thaw in the first quarter which may help stabilise sales at the levels they are at.”
Pipas expects Ford’s US market share at close to 14% for 2008 versus 14.7% in 2007.
