The sales downturn that lenders have been anticipating for some time has arrived.
Manufacturers on Wednesday reported a decline of about 1.8 percent in 2017 new vehicle sales, to 17.2 million cars and light trucks, following a seven-year streak of growth.
U.S. auto sales for 2018 are further forecasted to drop to 16.5 million units, according to Morgan Stanley, while Edmunds.com says 16.8 million light vehicles will be sold this year and S&P Global Ratings suggests auto sales of approximately 17 million units. This comes along as the latest challenge for an industry that faces possible tariffs on cars made in Mexico and Canada if the Trump administration negotiates major changes to the North American Free Trade Agreement. Gas prices too have risen, as the price was $2.49 a gallon for regular gas on Wednesday compared with $2.35 a year ago.
Ford Motor Company sales totaled 2.5 million vehicles for full-year 2017, a 0.9% year-over-year decrease; Toyota Motor North America sales totaled 2.4 million vehicles, a 0.6% YoY decrease; Fiat-Chrysler USA sales totaled 2 million vehicles, an 8.6% YoY decrease; General Motors sales totaled 3 million a 1.4% YoY decrease. Meanwhile, American Honda Motor Inc. sales totaled 1.6 vehicles, a YoY gain of 0.2%.
But despite last year’s decline, domestic auto sales remain at a historically healthy level. The seven-year stretch of growth between 2010 and 2016 represented the longest since the emergence of the automobile almost a century ago, according to the automotive publisher WardsAuto. This means that even a dip in sales, while technically a decrease, would still be better than historical averages. In 2009 for instance, during the height of the recession, new-car sales plunged to fewer than 11 million a year.
