YPSILANTI, Mich. -- Burned by the depth of this year's sales plunge, forecasters are cautious about 2010: U.S. auto sales will improve slightly. Unless they soar. Or crash.
After finishing at about 10.3 million this year, U.S. light vehicles sales will inch upward to 11.0 million next year, said Sean McAlinden, chief economist of the Center for Automotive Research in Ann Arbor, Mich. CSM Worldwide's head forecaster Michael Robinet picks a rosier 11.8 million.
But sales could be much higher or lower depending on events, both said today at a CAR briefing here. Automakers and suppliers must prepare for either extreme, they added.
Robinet laid out three “trip wires” that could cause a crash -- a double-dip recession, worsening consumer credit or a deeper housing crisis. His “upside potential” issues: a second U.S. stimulus program or a surge in consumer confidence.
McAlinden's 2010 forecast ranges from 8.5 million to 13.5 million, depending entirely on the shape of recovery.
“Will it be a good V, a bad L or a really ugly W?” he asked. If auto sales snap back as quickly as they fell -- in a V-shape pattern -- 2010 sales might hit 12.5 to 13.5 million. If the trend is L-shaped, next year will bring 10 million to 11.5 million. An “ugly W with bad financing, a crushed U.S. dollar, falling asset prices and rising unemployment” might depress sales to 8.5 million to 9.0 million units, McAlinden said.
Neither analyst expects U.S. sales to again reach to the 16.9 million unit industry average from 1999 through 2007.
Robinet said annual sales will get close to 16 million by mid-decade, but slower income growth and higher prices will more than offset population growth.
“There's a permanent change to a lower sales level,” said McAlinden, who forecasts no more than 16.2 million a year through 2020. “It really was a bubble.”