Strongest Pillar of Shaky US Economy has Cracked

‘Car Recession’ now expected to spread to 2017.
A ‘car recession,’ as the industry is calling it, or the ‘so-called car recession,’ as Ford called it on July 28 in its 10-Q filing, is taking hold. The more politically correct term that Ford also used is the ‘plateauing’ of industry volume. Which means, after six boom years, sales are going down.
They’re not crashing, for the moment. They’re facing tough headwinds, and so they’re drifting lower, despite enormous industry efforts to prevent it, and they’re now expected to drift lower next year as well.
Steven Szakaly, chief economist of the National Automobile Dealers Association (NADA), which represents about 16,500 new vehicle dealers in the US, forecast that sales of new cars and light trucks in 2017 will drop to 17.1 million.
‘We are headed toward a stable market for US auto sales, not a growing market,’ he said. ‘The industry has achieved record sales, and pent-up demand is effectively spent.’

This post was published at Wolf Street by Wolf Richter ‘ November 22, 2016.