After Robust Growth, August Auto Sales Take A Dip
ARI SHAPIRO, HOST:
In the last several years of gradual economic recovery, automobile sales have been a bright spot. And I'm using the word automobile because trucks and SUVs sell more than cars right now. For seven years, the auto industry has seen strong sales. Last year was a record, but the latest numbers now from August show a decline. NPR's Sonari Glinton reports.
SONARI GLINTON, BYLINE: I get to explain the current state of the automotive economy in about two minutes and 20 seconds. Are you ready? Set, go. The first question was for Jessica Caldwell, senior analyst with edmunds.com. After seven years of growth, do slower car sales mean the good old days are gone for the car business?
JESSICA CALDWELL: I don't think the good old days are gone quite yet. I mean, 2015 was a record year for new car sales, and the fact that we're almost at parity with that is pretty good. We're just not seeing those massive increases that we've gotten accustomed to since the recession has been over.
GLINTON: Caldwell says American car companies have learned a real lesson. They're selling cars people want, and they're making more money off of them.
CALDWELL: They can quickly pivot to any market fluctuation that they may see, which is really key 'cause we're not just talking about the U.S., but we're talking about, you know - the whole world is driving now, which also is a little bit different than we've seen since the past decade.
GLINTON: Next up...
ASHKAY ANAND: My name is Akshay Anand, and I'm an analyst with Kelley Blue Book.
GLINTON: Anand says even the most popular vehicles - SUV and trucks - saw some weakness in August.
ANAND: I don't think things are suddenly going to crash, but at the same time, it does call for automakers to start being a little more disciplined - right? - because long gone are the days of double-digit growth across the board. We're just not going to see that anymore.
GLINTON: Meanwhile, Eric Lyman with truecar.com says automotive sales have reached a peak, but...
ERIC LYMAN: I think it's more about the industry demand. So we see the macroeconomic conditions are still very robust. We're near full employment. Interest rates are still low. Credit's available. So it looks like there's just a lower demand for cars.
STEPHANIE BRINLEY: Frankly, the pain of the recession is just too near, and we all still remember it too acutely.
GLINTON: Stephanie Brinley is with IHS Automotive.
BRINLEY: The industry is cyclical. You know, if we have seven full years of growth, that's unusual, and that's atypical. The question really is can the industry be healthy when sales do contract a bit in 2017 or 2018.
GLINTON: OK last analyst with the last word - Juli Niemann with Smith Moore & Company in St. Louis.
JULI NIEMANN: But automotive manufacturing is no longer the big driver of the economy as it used to be. It is simply another consumer discretionary item.
GLINTON: Niemann says - does anyone still remember that phrase so goes GM, so goes the nation? Yeah, not so much.
NIEMANN: So the automotive industry certainly contributes tremendously to economic growth, but it also is not capable of sinking us. It follows the economy. It doesn't leave the economy.
GLINTON: Not anymore, at least.
NIEMANN: Not anymore.
GLINTON: All right. Thank you so much.
BRINLEY: You betcha (ph).
(SOUNDBITE OF PHONE HANGING UP)
GLINTON: Sonari Glinton, NPR News. Transcript provided by NPR, Copyright NPR.