On US Car Sales

Ed Wallace:

“Many analysts, dealers and executives believe the industry is actually healthier selling far fewer cars.” — Auto Industry Adjusts to New Normal: Low Sales, NPR, June 24, 2011

Everyone, it seems, wants to comment on the country’s new car sales lately. Among last week’s plethora of opinions, many argued that the auto industry is better off today selling fewer cars. Some comments explained how consumer spending fell back for the first time in nearly 18 months in May – partly because new car sales dropped. Certainly everyone reflected that just a decade ago Americans purchased 17.3 million new vehicles, but last year struggled to produce and sell just 11.5 million.

What was truly stunning about NPR’s reporting on the subject was that their expert was Jeremy Anwyl, CEO of Edmunds.com. True, Edmunds.com has become an extremely popular car-shopping Web site. With traffic estimated at 6.6 million unique individuals per month, no one can question its Internet credentials. But what Mr. Anwyl said does seem problematical, because it reveals that he lacks grounding in the industry’s historical trend. Moreover, in that NPR story Mr. Anwyl suggested that our new car market just wasn’t normal at 16 to 17 million sales a year; with population growth, he thought, we might someday see 16 million sales again.