CHICAGO — The overall outlook of economists at the recent Automotive Economic Forecast and Financial Forum was positive — they all believe the economy is on the road to recovery — but they all also recognize that road will be a slow uphill climb.

The event, sponsored by Experian Automotive, was held in early May at the Chicago Marriott Downtown Magnificent Mile and featured a variety of economists and analysts offering their summaries of the past year and predictions for the global, U.S. and automotive economies.

Keynote speaker Ellen Hughes-Cromwick, senior economist for Ford Motor Co., noted that there are roadblocks to a rapid recovery for the U.S. and global economies.

"Chronic deficits and debt are obviously an emerging problem for growth," she said. "We are not through this, even the second or third inning. This is important for (the auto industry) in that if it affects GDP growth, it's going to affect us because of the high correlation we have to the performance of the overall economy."

On a more positive note, Hughes-Cromwick recognized that in the U.S., chain store sales have risen significantly since the beginning of 2010, marking a return of consumer spending, a positive sign for the auto industry.

"Everybody thought the consumer was dead on arrival and that the consumer wasn't going to participate in this economy, but we are seeing evidence that yes, the consumer is back."

Hughes-Cromwick also evaluated the factors that cause the auto industry to grow, including driving age population, GDP per capita, number of vehicles in operation that are eligible for replacement, growth in vehicle ownership rates and cost of ownership.

"We have a substantial improvement in growth rate in the number of drivers globally and also in the U.S. From 2008 to 2020, we've got a 17-percent growth rate in the number of drivers globally. We're going to go from just under 5 billion drivers up to 5.7 billion drivers, people that will demand personal mobility."

The number of vehicles on the road is also on the upswing. In 2000, there were 751 million vehicles on the road globally, that has grown to almost a billion in 2009. Hughes-Cromwick predicts that this number will continue to rise significantly in the next decade.

She also noted the success of scrappage programs globally at helping to put an end to the downward spiral of new-vehicle sales.

"By the second quarter of last year, new-vehicle sales were tanking," said Hughes-Cromwick. "We were moving down about 40 percent. Were it not for all of the scrappage programs in Europe, their new vehicle sales would have come down similar to what we saw in the U.S. So those scrappage programs were very effective in helping to stimulate and also, I think, put a floor under the industry. If we didn't have those scrappage programs and we didn't have all of the stimulus and support for the banking system, it would have been a much different picture in 2009."

Hughes-Cromwick forecasts global vehicle sales of 65 million to 75 million units in 2010, with the U.S. accounting for 11.5 million to 12 million units.

While the automotive industry as a whole has undergone significant shifts during the past few years, Melinda Zabritski, director of automotive credit at Experian Automotive, noted that the overall finance market has remained relatively stable during the same time period.

"We're no longer seeing a lot of the really dramatic shifts in credit tiers that we would see throughout 2007, earlier into 2008," said Zabritski. "Throughout the past several years, it's been a pretty stable market. When we look at this prime-plus segment, we're up about 1.7 percent, which is good news for us; the population is improving as far as credit scores are concerned."

She added that total loan balances are down 6.7 percent, or $47 billion, to $658 billion.

"We certainly have some room to come back, and we definitely expect as we go throughout 2010 we'll start to see these numbers improve," she said.

In addition, while both 30-day and 60-day delinquencies continue to increase, the rates of increase are slowing down. More good news came as Zabritski broke down which loans were performing worst.

"One of the things that we're very optimistic about is when we take a look at the vintages of what loans are performing and where is the worst delinquency out there, it tends to be on the 2006 and 2007 originations. The credit quality of those originations was really poor. Those are the originations that are really driving the greatest acceleration of delinquencies.

"Fortunately for us, they're also falling off the books, and the more we can get rid of those loans, whether through general attrition or through repos, it'll eventually end up helping our delinquency rates, especially since originations have been so strong as of late, we're ending up with a much healthier portfolio. So I do expect to see the delinquency numbers begin to slow down even more, we'll hopefully see some improvement," she added.

Mark Vitner, managing director and senior economist for Wells Fargo Securities, also keynoted the event, providing a broad overview of the U.S. economy, saying that, while there hasn't been an official recognition of the end of the downturn, he believes the recession ended on June 30, 2009, at midnight. But he noted that the end of the recession does not mean an end to tough times.

"We've put out the fire, now we have to figure out how to pay the fireman," he said.

He added that he expects the unemployment rate to stay close to 10 percent in the second half of 2010, because while the economy is adding jobs, it's not adding them quickly enough to absorb the influx of new job seekers.

"The pace of expansion in the job market is a hurdle," he said. "We lost 8.5 million private sector jobs during the recession. If jobs grow at the average pace of growth over the last 20 years, it will be 2014 or 2015 before we replace all of the jobs lost in the recession.

"High unemployment won't keep the economy from growing, but it may keep it from growing very fast."

The two-day Automotive Economic Forecast and Financial Forum also featured presentations from Bernard Swiecki, director of market analysis at the Center for Automotive Research; Sudarshan Mhatre, senior analyst at PricewaterhouseCoopers Autofacts; William Strauss, senior economist and economic adviser at the Federal Reserve Bank of Chicago; Tom Kontos, executive vice president of customer strategies and analytics for ADESA and Matt Traylen, chief economist and client partner for Automotive Lease Guide.

The event was rounded out by a dealer panel featuring Tammy Darvish, president of DARCARS Automotive Group; Tim Trosclair, used-vehicle director for AutoNation; and Joe Castle, dealer principal for Castle Dealerships.