The World May End in 2012, but not Before the U.S. is Back on Top with New Car Sales!
Nostradamus be damned! How can the world end in 2012 when A.T. Kearney, renowned automotive consultants predict a return to 16 million new vehicle sales in the U.S. alone? The company released its forecast for 2010 U.S. auto sales this week and predicated sales to rise to 11.7 million light vehicles. That number was encouraging, but not nearly as much as the suggestion it made that by 2012, U.S. auto sales will rise to about 16 million vehicles, with a possible range of 12.9 million vehicles to 16.8 million vehicles.
Kearney forecasters said much of the rise will be attributed to pent-up demand and more available credit. The forecast also assumes the United States will not have a double-dip recession or a W as opposed to a V recovery from 2009.
New auto sales held above 16 million vehicles between 1999 and 2007 before falling to 13.2 million in 2008 and to 10.4 million in 2009, the lowest level since World War II adjusting for U.S. population. Kearneys forecast is more bullish than those of most other auto analyst groups and the automakers themselves, but the company defended the forecast based on precedent.
“If you look at the 1980s and the recovery from the low point then, the steepness of the return is much like our forecast,” Kearneys forecasters said.
They noted that the average age of U.S. vehicles is about 9.9 years, which will increase to around 10.1 years by 2011 before falling as more cars are scrapped and newer vehicles purchased.
Pent-up demand for new vehicles has accumulated to some 19.6 million vehicles, the forecasters noted, adding that as much as 47 percent of that demand will return to the new vehicle market starting in 2011.
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