A sluggish global economy and predictions for more of the same led J.D. Power & Associates to lower its forecast for worldwide light vehicle sales for this year and next – though the firm stressed that “it’s not time to hit the panic button yet.”
According to data collected by J.D. Power, total light-vehicle sales in August are expected to come in at 1.074 million units, which is just 4% higher than the same month in 2010 and only slightly higher than July this year.
Given the recovery stall that continues to persist and lower expectations for growth in the economy, the firm said it’s lowering its forecast for light-vehicle sales in 2011 and 2012.
Total light-vehicle sales for 2011 are now expected to come in at 12.6 million units, said John Humphrey, J.D. Power’s senior vp-automotive operations, and while that’s still a 9% increase from 2010, it’s down from the firm’s previous forecast of 12.9 million. Retail light-vehicle sales are now forecasted to top 10.2 million units for 2011, down from the previous prediction of 10.5 million units.
For 2012, J.D. Power lowered its outlook for total light-vehicle sales to 14.1 million units from 14.7 million, with its retail light-vehicle sales forecast dropping to 11.5 million units from 12 million.
“The economy and automotive industry continue to wrestle with a series of unsettling developments, which are now likely too strong to overcome within 2011,” said Humphrey in a statement. “While it is not time to hit the panic button, it is clear that ascending from the recession is proving to be just as bumpy as the decline into it, and a full recovery in vehicle sales is further down the road than previously thought.”
He added that light-vehicle production in the North American region has increased by 8% through the first seven months of 2011 from the same period in 2010, with volume of 7.3 million units.
At the country level, production in Mexico is showing the strongest year-over-year change, rising 16% with the addition of the Fiat 500, Ford Fiesta and new Volkswagen Jetta models. The U.S. follows Mexico with an 8% increase, while volume in Canada is off 1% hurt by production losses from Honda and Toyota.