WESTLAKE VILLAGE, Calif. -
This year is likely to “end on a high note,” as the stronger-than-expected retail new-vehicle market is projected to continue for the December, according to J.D. Power and Associates.
Judging by the month’s first 10 days, the firm predicts that December will finish with 936,300 retail new-vehicle units sold, a year-over-year gain of 19 percent when adjusted for one less selling day in December 2010.
The seasonally adjusted annualized rate for retail new-vehicle sales is expected to be 10.8 million units, compared to a SAAR of 9.3 million vehicles a year ago and 9.7 million units in November.
“Even with the possibility that sales in the third week of December may be affected by the recent winter storms, the strength in sales during the second week is expected to continue through the rest of the month,” pointed out Jeff Schuster, J.D. Power’s executive director of global forecasting.
“As a result, it appears that 2010 will end on a high note,” he added.
Continuing along, J.D. Power also looked at total new-vehicle sales (including fleet and retail) for December, which it believes will total more than 1.13 million vehicles, compared with 871,299 in November and about 1.03 million units sold a year ago.
The total SAAR for the month is expected to come in at 12.4 million vehicles, up from the 11.1 million-unit pace in December 2009 and the SAAR of 12.3 million vehicles in November.
As far as its full-year forecast, the company’s retail projection is now 9.2 million units sold, compared with the earlier prediction of 9.1 million units.
J.D. Power now expects total new-vehicle sales to come close to 11.6 million units. Its previous projection was 11.5 million units.
Predictions for 2011
Looking forward to next year, the company is still forecasting that the retail new-vehicle full-year sales total will reach 10.4 million vehicles and the total new-vehicle mark will hit 12.8 million units.
“The continuation of the strong performance in the retail market through December may be the confirmation that the industry has been looking for that the recovery has been re-engaged,” Schuster noted.
“The likelihood of an extension of the tax cuts, in addition to a strong close in 2010, bodes well for the automotive market in 2011,” he added.
Production Gains
Moving on, J.D. Power offered a bit of insight into some manufacturing numbers, which are likely to see a substantial increase on a full-year basis, according to the company.
It is likely that December’s vehicle production will total 800,000 units in North America. The market has already well-exceeded 2009 full-year production numbers of 8.5 million vehicles.
J.D. Power predicts that when final figures are tallied for 2010, about 11.8 million vehicles will have been built in North America, a 38-percent year-over-year increase.
Breaking it down by nation, the heftiest production uptick will likely be found in Mexico. The full-year production for that country is projected at 2.2 million vehicles, a gain of close to 50 percent.
J.D. Power explained that the drivers to this Mexican growth are domestics producing more trucks and the additional units coming from the Fiesta joining Ford’s lineup.
Next on the list was Canada, which is predicted to build 2.1 million units by year’s end, marking a 39-percent year-over-year rise.
Rounding out the list is the U.S., whose full-year manufacturing numbers are expected to reach 7.6 million units, a 35-percent gain.
The industry was stable on a month-over-month basis at the start of this month (67 days’ supply) when it came to vehicle inventory, but ahead of the December 2009 level.
There were 62 days worth of vehicle supply at that point.
Breaking it down further, J.D. Power said there is 71 days’ supply of current car inventory, while current truck inventory is at 64 days’ supply.
Taking a look at where 2011 is likely to go, J.D. Power believes there will be 12.7 million units built in North America.
This is up from the company’s earlier prediction of 12.6 million and if found to be true, would be an 8-percent gain from this year.