All right, before you fire off an e-mail to me and tell me to "get a clue" because tens of thousands of people did buy a new car or truck last month, take a deep breath. Exhale. Then look at how weak auto sales were last month.
- Chrysler down 56.5%
- GM down 50.8 %
- Ford down 40.2%
- Nissan down 32.4%
- Toyota down 32%
- Honda down 30.7%
Any way you slice it, they were ugly. The sales rate is expected to be under 10 million vehicles, the lowest since 1982.
So, do we look at these sales and say, "See, I told you the economy is getting worse." Or do we look at January and say, "Yeah, the number of people buying right now is awfully low, but things look like they are stabilizing?" You know, the old glass half full versus glass half empty question.
There is reason to believe auto sales may be close to a bottom based on what we are seeing with retail sales. Retail sales (those to the public through dealerships) appear to be roughly in line with the retail sales pace we saw in December. This would suggest we're seeing the base level of consumer demand for new cars and trucks. If that is the pace of sales we see the next couple of months, I think we could be in the midst of seeing a bottom in auto sales.
That said, there are few I talk with in the industry who are willing to call this the bottom. That's because the steady and depressing news of massive job cuts does not appear to have slowed down. Every time we hear of a company, like Caterpillar , cutting 20,000 jobs I think it weighs on the mind of potential car buyers.
Spare me the song and dance about this being a great time to buy.
If you see your neighbor lose job or know that your company could be the next to lay off thousands, you are unlikely to even think about buying a new ride.
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- Ford Motor
- General Motors
- Honda Motor
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