I wouldn't actually call this shocking news, but automakers are now officially acknowledging that the weak housing market, combined with high gasoline costs, are going to put a strain on auto sales for the year. This morning General Motors (NYSE: GM) joined the crowd.In its conference call for investors Thursday, GM lowered its 2007 sales forecast by 100,000, down to 16.5 million. This news comes a day after its American rival Ford Motor Co. (NYSE: F) made similar estimate cuts. Yesterday, Ford announced that it is now also expecting just 16.5 million cars and trucks to sell this year, down from its previous estimate of around 16.8 million.
If we take a look at all automakers, the estimates range anywhere from 16.3 million to 16.7 million vehicles this year. But some industry experts feel that even the low end of that spectrum is going to be out of reach for the year.
Autodata, a firm responsible for tracking industry statistics, has said that it is expecting to see auto sales down around 16.2 million during 2007, which is over 1 million vehicles lower than the industry record set 7 years ago. In 2000, the industry sold 17.4 million cars and trucks.
The one good side to this sales impact coming from higher gasoline prices is the shift in attitude of American car makers. As buyers are continuing to shift into smaller, more fuel efficient cars, American car makers are starting to make that shift as well, and in the end this can only benefit both drivers and the planet.
Michael Fowlkes has worked as a stock trader for seven years and spent the last two years working as an analyst for the online investment advisory service Investor's Observer.
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Reader Comments (Page 1 of 1)
8-09-2007 @ 2:05PM
William Martin said...
Well, well, you mean the auto makers are now realizing Americans are wanting more fuel efficient cars and a little smaller to? Any 8 year old would have known this given all the information and statistics that always been available. It was bound to come to this and I think they really have known it all along. Watch them "cry" some more as time goes on but its their own fault in my opinion. Theirs has been a blatant disregard for what was best for America.
8-10-2007 @ 1:56AM
Richard said...
Why don't they just say it as it really is..20-44,000 is a little much to be spending on a vehicle don't you think? Truthfully 10,000 is to much to pay for a vehicle. But for some reason all you car makers think your trucks, suv,s etc. are worth gold. And trust me there not. It's not that people are going to smaller cars for just fuel cost. There also doing it because of the outrages prices they pay on the vehicles themselves. Me I'll never buy a new car again. I have a 575.00 car payment which is way out of line for this piece of crap that I'm paying for which is a 2005. I will save face by not mentioning the make or model of the vehicle. But trust me the price doesn't even come close to what the vehicle is worth. I would of given maybe top dollar at 8 grand for it. If I knew how much I don't like this vehicle. So folks maybe you should reconsider the cost and make of your vehicles and get back to the real world when cars were cars and worth the cost.
8-13-2007 @ 5:25PM
rod kurtz said...
Gm has only one chance left,that is to get rid of the UAW, they are responsible of downfall of GM,No one can pay 75.00 to people who will not work.