Friday, 15 October 2010

Automotive Markets Show Improvement in September

The automotive industry witnessed a slight revival through the September period, following the disappointing figures of August. The stronger sales in September are not expected to be a sign of long term rebound after the recession however, but instead more of a positive note in a long term slump.

Brian Johnson, an analyst at BarclayCapital said on Monday that an upturn in those sales at retailers would be coupled with lower sales to those who buy in bulk, such as car hire and van rental companies. However this would be a positive nod to automotive manufactures as individual sales yield a much higher profit margin then fleet sales to larger firms or companies that deal in car and van rental, leasing, or other fields.

“We continue to expect sales to remain around current levels for the remainder of 2010,” he wrote, adding that he is sticking with his forecast of 12 million in sales for next year.

September sales numbers were predicted to be in the area of 11.7 million cars, vans, and trucks, a small but still increased margin from 11.5 million in the August period.

Brian Johnson went on to say “This would make September the best retail month in two years except for August of 2009, which was artificially boosted by the government’s Cash for Clunkers rebates. The numbers will be far higher than last September, which was a depressed month because Cash for Clunkers drew out buyers who would have otherwise waited until September.”

Across the nation this week is when the automakers report their figures for the month and on a year to year ratio. These results show that although sales are down the average price of of vehicles per is on the rise which means a higher profit. It seems although less people are buying those who are value paying the price for a quality reliable car van or truck.

The general consensus over low sales volumes is that consumers are still shaken in the economy, and employment, debt, and financial security are still issues. They believe that there are a large number of people that are stepping back and waiting for prices to fall before buying.However, automotive manufactures are now reducing their overheads and still profiting even with a lower sales volume. Those waiting for lower prices might be waiting a long time.

No comments:

Post a Comment