Forecaster and market analyst JD Power is projecting that the US light vehicle market will see a substantial drop in September following the end of Cash for Clunkers.
On the basis of actual data from the first 16 selling days in the month, September total light vehicle sales are projected to come in at 710,000 units, down 29 percent from September 2008. The September seasonally adjusted annualised rate (SAAR) for total light vehicle sales is projected to decline to 9.2m units, compared with a clunkers boosted 13.8m in August.
September new vehicle retail sales are expected to come in at 590,000 units, which represent a SAAR of 7.5m units (which compares with 11.8m units in August and 8.8m units in September last year).
“Low inventories and reduced incentives, combined with the effects of CARS pull-ahead sales, spell tough conditions for September,” said Gary Dilts, senior vice president of global automotive operations at JD Power.
“September’s retail SAAR is projected to be the lowest selling rate in 2009. However, improving consumer confidence and credit conditions in the months ahead are likely to help to rebuild the retail industry.”
Fleet volume remains low, and September fleet sales are expected to decline by nearly 50 percent, compared with one year ago.
The retail segment mix has returned to pre-CARS program levels, with the share of compact cars decreasing to 19 percent in September from 28 percent in August. Premium vehicles and large pickups have also returned to market share levels consistent with the 2009 average prior to the CARS program.
“After the anomaly created by the CARS program, September’s balanced segment mix indicates a return to more natural consumer behaviour,” said Jeff Schuster, executive director of global forecasting at JD Power.
“This stability is fundamental to a market recovery and a return to a healthy industry. However, consumers are hesitant and the automotive industry remains fragile, and the risk of a secondary decline remains.”
JD Power says it is maintaining its total light vehicle market forecast for 2009 at 10.3m units, with retail sales projected to come in at 8.6m units.
The 2010 forecast remains at 11.5m units for total sales and 9.5m units for retail sales.