Crossover sales may peak soon, says Merrill Lynch analyst

Crossover sales may peak soon, says Merrill Lynch analyst

Crossovers, which have been the hottest part of the vehicle market for some time, may be about to start slowing down, said Bank of America/ Merrill Lynch analyst John Murphy in his annual Car Wars report.

Crossovers now make up 35 percent of the market, but could top out at 40 percent, he told the Automotive Press Association in Detroit, reported The number of crossover models, now 78, is expected to reach 110 in the next two years. –An abundance of new production in a declining market may result in overcrowding,” said the report. Already, the average transaction price for crossovers is growing more slowly than it was, Murphy said.

But SUVs and light trucks overall will continue to have strong sales, and that will give an advantage to Detroit-based automakers. Because General Motors and Toyota have the largest number of new or redesigned models planned in the next three years, they are the most likely to gain market share.

Murphy predicts new-vehicle sales will reach 18 million next year but could fall to 13 or 14 million early in the next decade.

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