U.S. auto manufacturers are beginning to breathe more easily with sales of cars trending up by 9.3 percent from the beginning of the year until the end of August, and light truck sales increasing by 11.7 percent during that period, when compared to the same period in 2010, according to Wall Street Journal Market Data Center statistics.
Among midsize, small, luxury, and large cars, small car sales rose by 15.5 percent during the past eight months when compared to 2010, and midsize car sales increased by 8 percent. However, luxury car sales rose by only 1.4 percent, while large car sales took a nose dive, declining by 7.7 percent from 2010.
Midsize SUV sales rose by close to 51 percent, while large SUV sales declined by 2.7 percent during 2011 when compared to 2010.
In the United States, the Volkswagen Jetta took off with a 59.8 percent increase in sales during the first eight months in 2011, followed by the Chevrolet Equinox with total sales of 129,538 cars, an increase of 48.2 percent. The Hyundai Elantra followed close behind the Chevrolet with the sale of 133,536 cars in 2011, an increase of 46.8 percent over 2010.
With sales trending up, “some analysts cautioned there was a risk the industry would be caught out if demand flattens over the remainder of the year,” according to a recent article on the Auto Channel.
Auto customers are watching the economy closely with the media suggesting a deepening of the recession, “but they are not retrenching. You have to remember that the sales we’re seeing are very low by historical standards,” said Don Johnson, executive at General Motors Co. (GM), in the Auto Channel article.
U.S. Hybrid Car Sales Trending Downward
“One of the challenges for the hybrid market is the fickle nature of consumers: when gas prices rise, they buy hybrids; when gas prices are lower, hybrids are less popular,” according to an April report by Polk, a market research firm.
Despite automotive sales trending up, U.S. hybrid car sales declined by 2.9 percent in 2010 over 2009.
Hybrid car sales garnered only slightly over 4 percent of U.S. car sales in 2010. Total 2010 U.S. car sales amounted to 5.6 million cars, while hybrid cars totaled just about 236,000 cars, according to Ward’s Automotive Group.
“This drop can be explained by lower gasoline prices as well as the availability of a broader range of gasoline fueled, high-mileage subcompact vehicles,” according to the Polk report.
HybridCars, a website dedicated to consumer information about cars, energy, and the environment, reported sluggish hybrid car sales in 2011. This year’s hybrid car sales have decreased 12 percent when compared to the first eight months in 2010.
In the United States, a total of 21,177 hybrid cars were sold during August, amounting to 1.98 percent of all U.S. car sales. A total of 1,664 electric cars were sold during August, which amounts to .16 percent of all August car sales.
“The plug-in market has not yet reached 10,000 sales [in 2011], well behind what many observers expected,” according to a September report on the HybridCars.com website.
The Prius, a Toyota Motor Corp. hybrid car, was the most popular of all hybrid cars, accounting for 54 percent of 2010 sales and 51 percent in 2009. The Honda Insight was in second place with 8.5 percent of all hybrid car sales.
California is the main market for hybrid cars sales, with 24.3 percent of all U.S. hybrid car sales registered in that state. More than half of these sales were to people in Los Angeles. The District of Columbia, with 6.6 percent of all U.S. hybrid car sales, was the second largest market for hybrid cars.
“The hybrid market is in a state of flux, as manufacturers start to introduce even more alternative fuel vehicles,” according to the Polk report.
Analyzing Global Car Sales
In the early morning of Sept. 20, the Worldometers real time world statistics website reported that 43.8 million cars were produced worldwide during 2011.
There are more than 600 million cars on the road worldwide, and global car sales increased by 5 percent during the first six months of this year, according to the most recent international car sales statistics.
By the end of July, 60.1 million cars were sold worldwide, with 38.4 percent being sold in Asia, of which almost half were sold in China compared to less than 10 percent in India. The second largest car sales market was North America, with more than 80 percent being sold in the United States. Western Europe accounted for 22 percent of global auto sales.
While global car sales have trended up, individual car manufacturers are facing a reduction in car sales. In India, the three major car sales companies reported significant nose dives in August sales. Maruti Suzuki India Ltd. reported that all its domestic car sales dropped by 16.8 percent in August compared to August 2010. However, export sales increased by 18.5 percent, making the all-inclusive 12.7 percent decline a little less heart-rending.
Tata Motors Ltd. reported a 34 percent decline in passenger vehicles during the same time period compared to the prior year’s numbers. Then, Hyundai Motors India Ltd.’s domestic sales decreased by 6.7 percent, while exports increased by 10.5 percent.
“The market continues to be tough and there are no signs of recovery in the immediate future. The rising fuel prices and interest rates have been instrumental in this sluggish market trend,” said Arvind Saxena, director of marketing and sales at Hyundai Motors India, in a recent Hyundai press release.
Crisil Research, India’s rating agency, agrees with Hyundai’s sentiments, suggesting that increasing fuel prices and interest rates in India will curtail car sales in that country over the near future.
In China, considered to be the largest car market globally, sales are slowing down. During August, total auto sales increased by 8.29 percent when compared with July’s larger increases, according to the China Association of Automobile Manufacturers. For the last eight months, auto sales have increased by 6.05 percent.
“As car sales continue to slow in China, the central government plans to introduce a new incentive program in October to help struggling local manufacturers by encouraging the production of smaller, more efficient models,” said Edmunds Inc. Inside Line, an automobile information website.
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