U.S. auto market down, but not poisoned!

By saying the U.S. auto market goes down specialists literally ignore the fact that a shakeout normally requires a recession and rising unemployment to poison the market’s health, which by the way isn’t visible yet. Saying the consumer lending is currently in crisis is a wrong path, just like the worries that the U.S. car sales are about to dive by between 1 million to 4 million annually over the next 3 years.

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The downward spiral can be saved by another government “cash for clunkers” subsidies. A stretched consumer, falling used prices, and technological obsolescence of current cars are ingredients for an unprecedented buyer’s strike. Expect the 2017 vehicle sales to be at 17.3 million, of course that’s a bit down from a previous estimate of 18.3 million, which means it’s still a downhill, but it’s not so bad as we thought before. A further 7% decline will follow for 2018 car sales, but that’s something normal after 7 years of growing sales.

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