Contrary to some concerns about the war’s impact on new US vehicle sales, JD Power and Associates data shows that retail sales have dropped by only 8% since the start of the war with Iraq last week, compared with the corresponding four-day period a year ago. This four-day period is Thursday, March 20 through Sunday, March 23, 2003.
Power Information Network (PIN), a JD Power affiliate that collects daily new vehicle transaction data, reports new vehicle retail sales dropped 5% last Thursday, March 20, and 2% last Friday, March 21—the first two sales days after the war began—compared with the corresponding days a year ago.
Despite some upbeat claims by dealers reported by US media, JD Power says that the new vehicle retail sales pace dropped sharply over the past weekend. On Saturday—generally the busiest sales day of the week— retail sales were down 14% compared to the same day a year ago, and retail sales on Sunday were down 12%.
“While these are substantial declines, they are anticipated, and nowhere near the levels we saw in the days following the terrorist attacks of September 2001 when sales were off pace by 25%,” said JD Power chief economist Robert Schnorbus.
“What we saw over the weekend was people preoccupied with the war. With the nation’s attention now focused on the events in Iraq, we expect retail sales to continue to be down 10%, on average, over the remainder of the month.”
JD Power is forecasting retail sales for March 2003 of 1.18 million cars and light trucks, compared with 1.27 million in March 2002, based on the expectation that retail sales will be down 10% for the rest of the month.