Tag Archives: AUTOMOTIVE

Powerhouse USA creates Smell-a-Vision : now TV viewers will be able to watch and “smell” their favorite shows

ORLANDO, Fla.—April 1, 2012— Local advertising agency Powerhouse USA announces the creation of Smell-a-Vision. Now television viewers everywhere will not only be able to watch their favorite shows, but they‘ll be able to smell them. The invention is expected to revolutionize the digital TV world as we know it.

David “DP” Preschel, president of Powerhouse USA and creator of Smell-a-Vision, has been dedicated to the fields of advertising and marketing for over 20 years and has finally created the breakthrough that marketers have been striving to accomplish for decades. “We wanted to give viewers a more interactive way to learn about our clients’ products. We have now incorporated a third sense into the viewing experience; all that’s left is to literally put the product in consumers’ hands! We’re working on that next,” he explains.

Preschel has worked tirelessly with the team at Powerhouse USA every night for years until yesterday when he finally discovered the secret to the olfactory viewing experience. When asked for details of the technology behind Smell-a-Vision, he declined to explain the process as worldwide patents are still pending.

Since rumors have spread over the Internet, phones have been ringing off the hook at Powerhouse USA. Those who wish to implement Smell-a-Vision in their advertisements range from car dealers (who doesn’t love that new car smell?) to bakeries, and oddly enough, septic companies. But the most curious call of all has been from political campaigns. “Unfortunately, we’re having trouble developing the musk of Newt Gingrich,” Preschel laments.

Powerhouse USA is a full-service advertising, marketing and promotions agency in Orlando, Florida that has produced over 3,000 television commercials ranging from car dealerships to massage therapy. On April 1, 2012, they introduced Smell-a-Vision to media outlets and television viewers everywhere.

FEBRUARY AUTO SALES LIFT 2012 OUTLOOK

The U.S. auto industry reported a 16% sales jump in
February. In fact, sales were at their fastest pace in four years.
Automakers sold 1,149,396 cars and light trucks last
month. Quoting Autodata Corp, WSJ.com reports the
annualized pace of sales climbed last
month to 15.1 million vehicles, a level the
industry hasn’t seen since February 2008.
Chrysler led the way as sales rose
40% in February to 133,521 vehicles.
Chrysler company truck sales rose 21%
from a year earlier, while car sales more
than doubled.
Despite rising gas prices, Ford trucks
sustained the biggest increase, up 20.6%
from February 2011. Fuel-efficient Ecoboost
engines made up 43% of F-150’s sold to
individual customers. And after several months of year-overyear declines, sales of the Ford Focus more than doubled.
Ford’s Lincoln division recorded a 16% increase.
Meanwhi le, General Motors sales were up 1%.
Chevrolet’s 5.8% gain powered the overall increase, led
by a 10.1% gain from the Cruze compact, a 38.6% increase
from the Suburban SUV and a 30.7% gain for the Express
full-size van. But GM also posted declines in the Buick
and Cadillac divisions.
Toyota and Honda each posted 12% increases as they
continued to rebound from the earthquake in Japan last
March. It was Honda’s first double-digit gain since April and
Toyota’s first since February 2011.
Hyundai Motor Company announced all-time record
February sales of 51,151 units, up 18% versus 2011.
Sonata, Elantra and Accent total sales increases were 11
percent, 12 percent and 29 percent, respectively. Fleet sales
remain at a low eight percent as the focus remains on retail
customers.
Kia also had the brand’s best ever February sales , up
37.3% over the same period in 2011. Kia continues to be
one of the fastest growing car companies in the U.S., and
the February sales total marks the brand’s 18th straight
monthly sales record.
BMW Group, Jaguar Land Rover, Mazda and VW
were among companies with gains of 30% or more.
Mitsubishi was the only other automaker to record a decline
(-31%) in sales.

Surviving U.S. Auto Dealers may see record sales in 2012

Auto Dealers may see record sales in 2012; surviving dealers are stronger and more profitable
2/15/12Auto dealers may be racing toward a record number of sales.  A consulting firm is predicting that the dealers that survived the economic crisis may deliver more vehicles in 2012 than ever before.Urban Science is estimating that each dealer will sell an average  785 vehicles this year. That compares to only averaging 719 cars and trucks last year. They attribute the nearly ten per cent increase to pent up demand and the improving economy.

The previous record was 784 per dealership back in 2005.

The number of dealerships also grew last year, after shrinking for several years in a row. Urban Science says the dealers that survived the economic downturn are stronger and more profitable. There are now 17,767 dealerships in America.

GM’s Super Bowl commercial helped Ford

Super Bowl Ad Aftermath: Ford Boosted By GM’s Fallout?

Playing dirty might be de rigeur in politics, but it seldom helps in selling products—even dusty pickups ravaged by the apocalypse.

That might end up being GM’s tough lesson from its Super Bowl XLVI ad which, to some, spoke less about the strengths of GM products than it did attack Ford’s reputation for durability and longevity.

GM’s Super Bowl commercial helped Ford

Based on traffic and visitor data collected by the shopping and pricing site Kelley Blue Book, more visitors browsed Fordafter the GM commercial—a lot more—even though Ford didn’t have a big Super Bowl ad. Whether looking at the controversy in the days surrounding, or specifically at the window of time during and after the ad aired, Fordappeared to benefit most, if an immediate browsing or shopping of new vehicles was the goal.

Full-size pickup truck visitors on Super Bowl Sunday, 2012 – Kelley Blue Book

KBB.com data shows consumer interest in the Silverado lifting during the commercial airing, leveling off after the commercial and declining after the game, as interest in the F-150 surged, curiously. Despite the Silverado’s lift during the game, Ford’s F-150 still drew a greater share of week-over-week attention from KBB.com consumers.

In comparing consumer interest on kbb.com among the Full-size truck segment, KBB analyst Akshay Anand noted that the share of visits to the F150 surged over 26-percent week-over-week, while the Chevrolet Silverado 1500 saw a 25-percent drop in traffic during the same period.

“Looking at the data for that whole day, Ford did see some lift, and I don’t think that’s a coincidence,” said Anand.

That leads to how some might have heard the commercial…something along the lines of this: What kind of truck do you drive to the impending apocalypse? If it’s a Ford, oh you sorry sap, you’re just not going to make it.

Advertising 101: Don’t make the competing product your punchline

And that hits hard at one very important factor: brand loyalty. To many, the commercial was less a declaration of the strengths of GM products than it was the buildup to an attack on Ford’s trucks. And it may have sent Ford loyalists to their laptops and tablets to search for reassurance about Ford’s reputation, as their GM counterparts gloated and stayed on the sofa.

“Truck owners tend to be more loyal than those in any other segment,” said Anand, and when a product with that level of loyalty is mentioned negatively in an ad, argued Anand, the response is likely to be one that’s on the defensive.

Other potential explanations: Ford was mentioned bluntly and clearly right near the end of the ad, so is that somehow the name that stuck with viewers? Or does the lesson to be learned really have more to do with etiquette?

It is, after all, one of the first commercials in some time to blatantly call out a competing product without mention of a number or metric as basis.


U.S. auto sales jumped 11 percent in January, led by huge gains at Chrysler Group and Volkswagen of America. Best January since 2008

U.S. auto sales jumped 11 percent in January, led by huge gains at Chrysler Group and Volkswagen of America.Automakers sold 913,284 light vehicles for the month, the best January since 2008. The seasonally adjusted annual selling rate was 14.2 million, which matches the cash-for-clunkers selling rate of August 2009.

Toyota Division General Manager Bob Carter said January had “a very healthy” sales pace.

“It’s significant to see 913,000 in January when much of the country typically is in a deep freeze,” he said. “We’re bullish with where the industry is going.”

Most major companies gain

Among the highlights:

— All major players posted sales gains except General Motors, which fell 6 percent from a strong January 2011 that had been buoyed by strong incentives.

— All four GM brands lost ground: Chevrolet was down 1 percent, GMC lost 10 percent, Buick 23 percent and Cadillac 29 percent.

— Chrysler Group volume jumped 44 percent to 101,149 units. The growth was led by Chrysler brand, up 81 percent.

— Hyundai-Kia Automotive gained 20 percent overall: Kia rose 28 percent and Hyundai 15 percent.

— Nissan North America sales increased 10 percent, just under the industry average overall. But after being passed by Hyundai-Kia for the No. 6 U.S. sales position, Nissan’s 79,313 light-vehicle sales gave it a 1,102-unit lead over its South Korean rival to start the year.

— American Honda gained 9 percent in January, its first year-over-year increase since April and a sign that its restocking efforts since the March earthquake and tsunami in Japan and flooding later in the year in Thailand are working.

— Toyota Motor Sales, which also had been slammed by the natural disasters last year, boosted sales 8 percent to 124,540 units. Toyota brand rose 9 percent, offsetting a 5 percent decline at Lexus.

— Ford Motor Co. increased sales 7 percent in January, with Ford division up 8 percent and Lincoln down 8 percent.

Mazda, Subaru sales rise

— Among the smaller players, Volkswagen Group sales soared 40 percent to 36,681 units, led by a 48 percent increase for the VW brand and 20 percent higher sales at Audi.

— Mazda posted an even bigger gain, up 68 percent to 23,996 vehicles.

— Subaru volume rose 21 percent, its second month of growth after a seven-month stretch of declines as it struggled to restock U.S. dealer lots after the natural disasters of last year.

— Daimler AG gained 23 percent, with 23 percent growth at Mercedes-Benz and 39 percent at Smart.

— BMW group sales rose 6 percent overall, with a 21 percent increase at Mini pumping up a more modest 3 percent gain at BMW brand.

— Other European premium brands posted increases: 31 percent for Jaguar Land Rover, 6 percent for Porsche and 4 percent for Volvo.

— Only two small Japanese automakers posted sales declines in January. Mitsubishi’s volume fell 18 percent while Suzuki tumbled 41 percent to 1,505 units.

Odds and ends

— Tough sledding for luxury: A few luxury brands outperformed the industry’s 11 percent rise in January. Land Rover jumped 41 percent, Mercedes-Benz gained 23 percent and Audi 20 percent. But Jaguar, Porsche, Acura and BMW eked out modest unit increases below the industry average. And Lexus fell 5 percent, Lincoln and Infiniti each lost 8 percent, and Cadillac tumbled 29 percent.

— The industry’s shift to greater North American production continues. U.S. sales of vehicles made in the United States, Canada and Mexico were 77.9 percent of total industry volume, up from 76.7 percent last January.

— Oddity: Audi outsold Cadillac in January, 9,354 units to 8,924. Until Cadillac can get its new XTS and ATS sedans into showrooms, it is limited to essentially three models: the CTS sedan and SRX and Escalade SUVs.

— Best-seller surprises: Compared to the 10 best-selling nameplates for 2011, January’s top 10 list has three new names. The Honda Accord and Ford Fusion dropped out, but Honda added the Civic and CR-V. And the Chevrolet Cruze got bumped by its big brother, the Chevy Impala.

— Guess who’s No. 2? One other Top 10 shakeup: The new-generation Toyota Camry, introduced in September, outsold the Chevy Silverado pickup, ousting it from its perennial No. 2 sales position behind the Ford F-series.

— Trucks bucked: January also changed the list of 2011 best-selling trucks. Out: 2011’s No. 7 GMC Sierra and No. 10 Kia Sorento. In: the Jeep Grand Cherokee at No. 7 and Nissan Rogue at No. 9.

— Cars rule in January: Cars outsold light trucks last month, 474,449 to 438,835, a 51.9/49.1 split. A year ago trucks ruled, 413,962 to 405,924, a 50.5/49.5 split.

Watch those comparables

It’s time to readjust expectations based on the most common industry sales measurement: comparing sales to performance the year before.

— Hyundai-Kia and Chrysler are coming off 2011 performances up more than a quarter, so it will take huge months for them to move the needle much this year.

— Both Toyota group and American Honda sales fell 7 percent in 2011, so posting even modest increases will look good this year.

— Sales comparisons also will be easier for Ford and GM this year because the drag of those dead or sold brands has washed out of year-ago numbers. For GM, no more year-ago sales of Pontiac, Saturn, Hummer or Saab models. Ford has no Volvos and only a wisp of Mercury sales on the 2011 blotter.

Consumers still wary going into 2012

The Harris Poll has made its annual beginning-of-the-year assessment of the financial plans and sentiments of Americans, and it finds continued uneasiness. This is despite a recent spate of confidence polls that show at least mild improvement. However, a bright spot in the study is the finding that fewer consumers will be looking to decrease their household spending than last year.

The most general result concerned overall expectations for the economy in 2012. Almost half expect things to remain about the same – 47%, to be exact. Pessimists unfortunately outnumber optimists by a 29%-23% margin.

Looked at by age demographic, the older respondents were the most pessimistic. The mature 66+ crowd actually managed to be the most optimistic AND the most pessimistic. The chart below tells the tale. As a point of age reference, Echo Boomers are 18-34, Gen-Xers are 35-46, Boomers are 47-65 and Matures are 66+.

Expectations Echo GenX Boomer Mature Total
Improve 23 22 23 28 23
Stay the same 55 51 42 38 47
Get worse 22 27 35 34 29
Source: The Harris Poll

One thing is clear from the survey – the economic collapse experienced in 2008 has had a lasting impact on consumer money-handling habits. Gone are the days when revolving credit accounts and home refinancing kept stock moving off of American retail shelves and out of American warehouses. Consumers are still more apt to pay off rather than incur debt, and accumulating savings is much more top-of-mind than it was before the fall of 2008.

“There has been plenty of reporting on Americans’ financial concerns for the past several years,” commented THP as it scanned the downward trends. “However, looking at Americans’ current expectations for both their own finances as well as for the state of the nation, it seems that the bad news may not be over yet.”

The number we particularly like to see in the latest Harris survey is 45% — that is the percentage of respondents looking to cut overall household spending in 2012. We’d like to see it much lower, but it still beats the 49% of thrift-oriented respondents from the 2010 survey and is much better than the 55% in 2009.
The percentage of respondents looking to pay down debt, invest more in savings, cut up a credit card (or two or three), sock money away for retirement and invest in home improvement have all been trending down over the three year period.

Harris did note that the decrease in houses looking to cut expenses was a positive sign.

Here are the three year trends in a number of fiscal categories:

Fiscal action 2009% 2010% 2011%
Cut household spending 55 49 45
Pay down debt 45 41 39
Save more 42 40 36
Drop credit card(s) 24 22 16
Save for retirement 21 22 16
Home improvements 14 13 11
Invest more safely 9 8 5
Refinance mortgage 5 6 5
Open home equity credit 2 2 1
Other 6 6 5
Nothing different 16 18 23
Source: The Harris Poll

The 2011 results from the chart above were also provided by age demo. It should not come as a surprise that the Mature group results can almost be tossed – if members of this group have not made a few investments into retirement by now, for example, there isn’t a whole lot of time left to catch up – and indeed, very few cited this as a 2012 priority, and in almost all categories, they were far below the national average.

The middle two groups are more likely to cut spending and eliminate debt, while the younger set is more interested in filling up savings accounts. Here are the full results:

Fiscal action Echo GenX Boomer Mature
Cut household spending 42 49 49 38
Pay down debt 35 49 44 24
Save more 47 38 34 18
Drop credit card(s) 13 16 21 12
Save for retirement 15 18 21 5
Home improvements 8 9 15 9
Invest more safely 4 7 6 4
Refinance mortgage 3 9 4 2
Open home equity credit 0 1 1 1
Other 6 5 4 2
Nothing different 21 17 21 39
Source: The Harris Poll

Harris summed up its results, saying, “Americans continue to face difficult economic times and the New Year may not provide a totally clean slate financially, but there are some bright spots when Americans discuss their expectations. Fewer U.S. adults now say that they will cut back their household spending in the year ahead. This is positive news for the millions who rely on the retail, dining and entertainment industries, and may be small sign that Americans are ready to move on from the harsh times of the past several years.”

Apple Devices Dominate Mobile Online Shopping

The holiday season came a little early for Apple this year, but it’s not as if the company didn’t already know what it was getting. New statistics released this week from retail analysis firm RichRelevance indicate that iPads and iPhones are the top mobile devices that consumers use to make retail purchases.

By just how much, you ask? According to RichRelevance, 92 percent of all “online non-desktop sales” came from an iOS-friendly device during December. Better still (for retailers), those using their iPhones, iPads, and other iOS devices to shop online spent more, on average, than those shopping via other mobile platforms like Android: $123 for iOS devices versus $101 for Android devices. Even though desktop-based sales crushed mobile-based purchases in volume, the average order value of these purchases only reached $87.

“The numbers across our retailing partners sites demonstrate just how powerful the iOS platform is enabling mobile web shopping and, while still below 5 percent in total conversion, mobile traffic’s doubling in eight months is a trend we only see accelerating,” said David Selinger, RichRelevance CEO, in a statement.

In total, mobile device-based shopping hit around 3 percent of all online sales analyzed by RichRelevance—more than 3.4 billion sales in total, stretched across the months of April to mid-December. Translated out to raw dollars, mobile-based sales jumped from 1.87 percent of all U.S. online retail spending in April to 3.74 percent in December.

As mentioned, this news should come as little surprise to Apple, as the company has already seen snapshots of iOS mobile shopping dominance. Take, for example, Black Friday: According to IBM, the iPhone and iPad ranked first and second for consumer shopping on mobile devices on Black Friday itself (5.4 percent and 4.8 percent, with Android-based devices taking up third at 4.1 percent). That totals just over 10 percent of the mobile shopping market for Apple’s flagship products.

IBM also indicated that the specific Black Friday conversion rates for the iPad—a comparison of online visits versus purchases made—were double those of the mobile device category as a whole (4.6 percent to 2.8 percent.)

Even though Android enjoys a healthy lead in overall global market share for smartphones versus the iPhone—no doubt a result of Android’s ability to exist on multiple devices versus the single iOS smartphone product line—it seems that iOS users continue to carry the day for mobile shopping.

U.S. auto industry recovering faster than anticipated; Automakers headed toward best annual performance in three years

The U.S. auto industry is seeing demand recover faster than anticipated, with carmakers headed toward their best annual performance in three years at sales of 12.8 million vehicles.

Consumers entered this year’s final month demanding models ranging from big pickups to luxury sedans to fuel-sipping hybrids after pushing November’s sales to the fastest monthly pace since the government’s “cash for clunkers” trade-in program in August 2009. General Motors Co. (GM) and Chrysler Group LLC, two years removed from bankruptcy, have been taking share from disaster-stricken Toyota Motor Corp. and Honda Motor Co.

U.S. buyers are replacing their cars after delaying new- vehicle purchases as long as possible, and they are snapping up F-Series pickups and Prius hybrids as consumer confidence in the economy jumps. That means the automakers haven’t had to resort to fire-sale prices to goose demand.

“The industry has managed production levels to where demand was this year and didn’t get ahead of itself,” said Jeff Schuster, a Troy, Michigan-based analyst for LMC Automotive. “With inventory now being replenished, it’s not a situation where we’re seeing too much production or seeing heavy incentive use.”

Spending on marketing promotions averaged less than $2,700 a vehicle throughout the industry, down about $74 from a year ago, according to LMC and J.D. Power & Associates.

Consumer confidence surged in November by the most in more than eight years, and the portion of consumers planning to buy a new vehicle within six months climbed to the highest since April, data from The Conference Board showed Nov. 29.

The average age of cars and light trucks on the road today has risen to 10.6 years old, Jenny Lin, Ford’s senior U.S. economist, said on a Dec. 1 conference call.

“We are going to see more and more of this pent-up demand realized,” Lin told analysts and reporters.

She cited declining gasoline prices for providing “relief” to consumers, who responded with purchases of sport- utility vehicles and pickups. Sales of Dearborn, Michigan-based Ford’s SUVs climbed 29 percent and F-Series trucks increased 24 percent.

GM’s deliveries of Chevrolet Silverado and GMC Sierra pickups surged 34 percent and 22 percent, respectively, and Chrysler’s Jeep brand sales soared 50 percent. The average price for unleaded gasoline has dropped 71 cents, or 18 percent, to $3.28 a gallon on Dec. 3 from its peak this year on May 4, according to AAA, the nation’s largest motoring group.

Consumer demand was broad-based, as Toyota (7203) and Honda boosted deliveries of smaller vehicles, making up for production lost after March 11’s tsunami and earthquake inJapan and more recent floods in Thailand disrupted their supply chains.

Toyota, Asia’s largest automaker, reported a 49 percent increase in sales of Prius hybrid models, including its new wagon variant. Deliveries of its redesigned Camry sedan climbed 13 percent to 23,440, securing its position as the top-selling car line ahead of Nissan Motor Co.’s Altima and the Ford Fusion. Toyota slashed discounts on cars by 32 percent last month, according to researcher Autodata Corp.

Honda, the only automaker among the 10 largest that didn’t have a companywide U.S. sales increase for November, still managed to boost deliveries of Civic cars by 3.4 percent. That’s the first increase since April for the Tokyo-based automaker’s top-selling model.

Among luxury brands, Daimler AG (DAI)’s November deliveries jumped 47 percent, as the brand’s year-to-date sales closed to within 1,600 of Bayerische Motoren Werke AG (BMW)’s BMW line. The two German brands are vying to replace Toyota’s Lexus, the annual luxury champ for the last 11 years, which also lost production to the March disasters.

Industry sales accelerated to a 13.6 million seasonally adjusted annualized rate, according toWoodcliff Lake, New Jersey-based Autodata. The pace exceeded the 13.4 million average estimate of 14 analysts surveyed by Bloomberg.

“The recovery is showing a little bit more resiliency than what people feared,” Paul Ballew, chief economist for Nationwide Mutual Insurance Co., said in a Dec. 1 phone interview. “Vehicle sales are inching their way back up to 14-, and then eventually 15- and 16-million units.”

If December matches November’s 14 percent increase in industrywide deliveries, auto sales will finish the year at 12.8 million cars and light trucks. That would exceed the 12.7 million sales total that was the average estimate of 18 analysts surveyed by Bloomberg in August.

Jefferies Inc., IHS Automotive and TrueCar.com are now considering increases to their estimates for 2012 deliveries, according to analysts at the three firms.

Auto sales may total 13.5 million light vehicles next year, the average of 14 estimates compiled by Bloomberg. The industry delivered 11.6 million cars and light trucks last year, up from a 27-year low of 10.4 million in 2009.

The seasonally adjusted annualized rate for auto sales “appears to be building to a 2011 exit run-rate close to 14 million without a full Japanese supply recovery and bad economic news cycle,” Adam Jonas, a New York-based analyst for Morgan Stanley, wrote in a Dec. 1 research note. The momentum “bodes well for 2012,” he said.

Pandora hits the road with Toyota Entune system

Toyota is now offering an embedded version of Pandora on the 2012 Camry and 2012 Tacoma. That’s big for the streaming audio service, since the Camry is America’s best-selling car and the Tacoma is the best-selling compact pickup truck in the US market.

According to the announcement by Pandora Media, both vehicles began to appear on dealer lots in September 2011.

Pandora is available via the Toyota Entune system. With Entune, Pandora controls are made available via the radio dashboard, allowing drivers to easily select stations, thumb songs up and down, and skip songs using the vehicle’s controls. The key to connecting Pandora with Entune is the smartphone; Entune is currently compatible with Android, Blackberry and iPhone smartphones.

“Incorporating Pandora into the native environment of the car makes turning on personalized radio as easy as traditional radio. We’re thrilled that Toyota is offering our service to their drivers,” said Pandora executive vice president of business and corporate development Jessica Steel.

J.D. Power Reports: September New-Vehicle Retail Selling Rate Shows Marked Improvement From August

 

 Sept. 22, 2011  — New-vehicle retail sales for September continue to improve, with the selling rate expected to be much stronger than in August, according to J.D. Power and Associates, which gathers real-time transaction data from more than 8,900 retail franchisees throughout the United States.

Retail Light-Vehicle Sales
September new-vehicle retail sales are projected to come in at 842,400 units, which represents a seasonally adjusted annualized rate (SAAR) of 10.3 million units. This marks the first time the retail selling rate would be above 10 million units since the 10.8 million-unit rate in April. Retail transactions are the most accurate measurement of true underlying consumer demand for new vehicles.
“Coming off a solid Labor Day sale, retail sales exhibited unexpected strength in the second week of September, as the recovering inventory levels have helped to bring buyers back into the market,” said Jeff Schuster, executive director of global forecasting at J.D. Power and Associates. “However, incentive levels remain flat compared with August and the economy remains a concern, so the sales pace in the second half of the month is expected to give back some of the gains.”
Total Light-Vehicle Sales
Total light-vehicle sales in September are expected to come in at 1,038,700 units, which is 9 percent higher than in September 2010. Fleet sales are expected to be down 1 percent compared with last September, but will account for 19 percent of total sales.

Sales Outlook
Given the relative strength of September, J.D. Power is maintaining its forecast for light-vehicle sales in 2011 and 2012. Total light-vehicle sales for 2011 are expected to come in at 12.6 million units, a 9 percent increase from 2010. Retail light-vehicle sales are forecasted at 10.2 million units for 2011, an increase of 11 percent from 2010.
For 2012, the outlook for total light-vehicle sales remains at 14.1 million units and retail light-vehicle sales are at 11.5 million units. However, there is a high level of uncertainty that remains.
“The uncertain global environment, specifically the debt troubles in Europe, continue to be the major source of downside risk in the U.S. economy and automotive markets,” said John Humphrey, senior vice president of automotive operations at J.D. Power and Associates. “Until a level of stability is reached globally and consumer confidence is returned, the U.S. automotive selling pace is not expected to return to pre-recession levels.”
North American Production
Through August 2011, light-vehicle production in North America has increased to 8.5 million units, up 8 percent from the same period in 2010. The Detroit 3 OEMs have increased production by 16 percent year-to-date, while the Japanese manufacturers have lost 8 percent—due to the parts shortages from the earthquake in Japan back in March. European OEMs are up 38 percent for the same period, as a result of added production of the BMW X3 and Volkswagen Passat in North America, as well as strong demand for the new Volkswagen Jetta.
Vehicle inventory maintained a 49-day supply at the beginning of September, unchanged from August. Car inventory remained at the same 40-day level as it was in the previous month, while truck supply edged down by one day to 57 days. With stronger production levels and imported shipments returning, inventory is improving—although several manufacturers continue to have limited supply availability: Hyundai/Kia with a 21 days’ supply (was 19 days in August), Honda with a 32 days’ supply (previously 28 days), and BMW at 33 days’ supply (previously 30 days).
The 2011 North American production outlook remains on track for 12.9 million units, an increase of 9 percent from 2010. Fourth-quarter 2011 production output is expected to reach 3.3 million vehicles, which is an increase of 11 percent from the same quarter in 2010.
“Continued inventory stock replenishment and Japanese OEM recovery is responsible for the large year-over-year increase relative to the lower level of recovery in vehicle demand,” said Schuster. “As inventory normalizes into 2012, growth in production levels is expected to slow to a pace more consistent with sales.”