Economists and forecasters are seeing darker sales clouds on the horizon.
EDITORIAL

Slowdown ahead?

Related Topics

Five years into a long, steady auto sales recovery, economists and forecasters are seeing darker clouds on the horizon.

Post-recovery, the pace of expansion is slowing, and growth is getting harder to sustain. That means automakers, suppliers and dealers should consider how previously modest or far-off problems could affect business.

Some concerns are short-term. U.S. housing starts are down, and that could limit pickup sales. Personal income is stagnant; financial markets have stumbled, and low interest rates may rise next year.

Longer term, rising road congestion and pollution levels could blunt growth in China. U.S. job growth is weak.

The cost of meeting federal fuel economy standards for the 2025 model year inevitably will raise retail car prices, crimping automaker sales and profitability. Higher quality cars that last longer help consumers but reduce replacement demand.

The entire industry has flourished and replenished drained coffers during five years of booming U.S. vehicle sales. But as growth slows, auto companies can't stand pat. They must adapt to new conditions and cultivate new disciplines to continue thriving.

Contact Automotive News


advertising
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

Or submit an online comment below. (Terms and Conditions)




Rocket Fuel