The last we heard, the auto industry was booming. Sales are healthy and recovery from the multi-year slump brought on by the global economic meltdown of 2008 is well on its way, with domestic sales projected to reach as high as 14.5 million vehicles. We even heard a rumor that Ford would soon be installing cash machines in its executive lavatories that dispensed well-worn twenties.

Okay, so that last part isn't true. But the first is also suspect, according to new forecasts from analysts. As reported by Reuters, LMC Automotive, formerly a branch of JD Power, has revised its 2012 prediction down to 14.3 million vehicles, matching that of rival consultant Polk. LMC also cut its forecast for 2013, from 15.2 million to 15 million, though it does expect the U.S. auto industry to be back at 2007's 17-million-unit level by 2017.

Other projections are even more conservative, according to the report. Sean McAlinden, chief economist for the Center for Automotive Research, is hedging his bets, pointing out that housing usually recovers first after a recession, while this year upwards of 40 percent of economic growth has been auto-related. CAR's forecast calls for 2012 sales to stop at 14.2 million and next year's totals to hit just 14.6 million units.


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  • 19 Comments
      Bloomsbury
      • 2 Years Ago
      It probably wouldn't be a good sign if sales did get back to previous levels too quickly, since previously tons of people were buying cars they couldn't actually afford to pay for.
        SCOTTM
        • 2 Years Ago
        @Bloomsbury
        "To pay for" wasn't necessary. Should've just dropped the period after afford and called it a day. Sincerely, The Grammar Police
          PaddO
          • 2 Years Ago
          @SCOTTM
          Ahh, but in America that was not necessarily redundant. I could not afford my car at the time I "bought" it, I did not have $27,000 in cold hard cash. So I took out a loan with a bank who could afford to pay the dealer the 27,000 or so dollars while I make monthly payments they determined I could afford to pay them. My name may be on the title, but so is theirs and they are the only one who can unilaterally sell the car I drive everyday. And that entire process is what got so twisted to a point comparable to the sham real estate market before '08 due to the recklessness of the government,a lot of lenders, and way too many consumers. Given the main source of America's population growth being illegal immigration along with Gen Y's disinterest/inability to purchase a vehicle, one could make the conclusion that if we see 2007's sales levels as soon as 2017 then there is something seriously wrong and would likely be a result of market manipulation on a scale only government interference could be dared to imagine to try to achieve again. But that conclusion is probably wrong. Real estate is now adapting to the new America. Landlords are buying the homes now, not Joe the plumber/self-taught investment analyst, not the young man fresh out of college with his baby mamma and their child/new-found peer who apparently has a rich Uncle Sam that pays for food every month. Not anymore, the market is correcting itself to following more traditional, conservative, logical, and responsible lending practices, whether some want to or not. For those with poor credit, no doubt one of the fastest growing segments of the automotive market, that means buying a house is still an american dream but just more like some other american dreams; owning a Ferrari, diet pills that actually work, and at least 2 attractive wives (doesn't have to be all at the same time, though). My guess is, instead of saving for years for a down payment, and meeting the requirements for income and financial stability, most of the consumers who bought what they couldn't afford to pay for will rather just rent a house and have a nice and shiny new car parked on their driveway... until the landlord calls them and says the HOA requires they park in the garage if the car sits idle for more than 20 minutes on an odd-numbered day of the month. Oh, and they better not be smoking in there, a woman 1 mile away is allergic to cigarette smoke and it just smells bad anyway. You wouldn't want me to call Uncle Sam on you, now would you? And so goes the circle of life. There's a sucker born every minute, people buy things they can't afford, and big brother is always watching. Oh, and the vast majority needs to own a car to avoid a 3-7 hour commute to work. 2017 could really be the year, crazier things have happened.
      tylermars.design
      • 2 Years Ago
      The only other "forecasters" I know get paid to be right 20% of the time......
      dave and mary
      • 2 Years Ago
      Take heart America: If Oblah blah is re-elected, he'll give us another $210,000 per car cash-for-clunkers. That should revive the economy the way the first one did. Exactly the way the first one did.
      Radwon
      • 2 Years Ago
      Is it that obvious that Obama is in the house for 4 more years?
        • 2 Years Ago
        @Radwon
        [blocked]
      Keldon
      • 2 Years Ago
      Is it me or is the old guy about to kick the salesman's ass?
        bluemoonric
        • 2 Years Ago
        @Keldon
        No. He just told the salesman his beacon score was 450. See how embarrassed his wife is.
      Keldon
      • 2 Years Ago
      Saw this coming months ago. Dealer lots in my area have been overstuffed for months with little to no traffic.
        tinted up
        • 2 Years Ago
        @Keldon
        It's true, sales spiked a couple months ago and lots got emptied pretty rapidly. Now that the new inventory is piling in the sales are stalling, quite worrisome for me because it's how I put food on the table.
          Keldon
          • 2 Years Ago
          @tinted up
          tintedup...i know, its like all the auto manufacturers decided the recession was over after the bailout fiasco and went nuts building cars, now dealers are bursting at the seams and nobody is buying.
          Radwon
          • 2 Years Ago
          @tinted up
          Yeah, but people need to have the cash to buy them and banks don't loan to people without jobs anymore, or even people with jobs for that matter.
          Keldon
          • 2 Years Ago
          @tinted up
          Sorry to hear that. Could another "cash for clunkers" be on the horizon?
          PaddO
          • 2 Years Ago
          @tinted up
          You should stop by your local Kia dealer, tinted up. That brand is on fire and they are still offering good spins and are super-easy to get certified for. And if there is another cash for clunkers, it'll be even better there. I worked at a Hyundai-Kia dealer in '09 and we made a killing then (way more than my buddies at other franchises). All those boomer cheapskates dumping their cars for a bit of cash from the government to step into a cheap Korean model that is "just as good as any other car, I don't care what I'm driving, I just need to get from point A to point B." Good times! Seriously, though, they now really do make a decent product. and are getting popular for a reason (Near-Toyota quality at Dodge pricing). Nissan's doing pretty good, too. Either way, just don't get dragged down with your lot, you gotta at least see what's out there, especially if you are at an automotive group.
          mr.vw
          • 2 Years Ago
          @tinted up
          I work with some of the local car dealers from various brands and they are starting to lay off their good people just to keep the doors open longer, there's no traffic. I wonder if everyone is watching the global events unfold. I notice the corp shift towards small or should we say cheap cars and now even cheaper. I wonder if the corporations can smell the fiscal defacation coming?
          tinted up
          • 2 Years Ago
          @tinted up
          A cash for clunkers, despite being a huge headache in terms of paperwork, would actually be kind of nice at this point. ITS THAT BAD!
      • 2 Years Ago
      [blocked]
      NY EVO X MR GUY
      • 2 Years Ago
      These companies are too large. They may have to reduce size to scale back overhead costs and to obtain more profit.
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