After strong growth, auto sales fell in August.
Major auto makers reported a drop in sales in August. The drop in sales means carmakers are unlikely to hit a record year in 2015 and could signal a slowdown in the car market.
ARI SHAPIRO, host:
Car sales have been a bright spot in the last few years of the economic recovery. And I’m using the word car, because trucks and suvs now sell more than cars. The auto industry has enjoyed strong sales for seven years. Last year was a record, but the latest figures, which began in August, show a decline. NPR’s Sonari Glinton reports.
Sonari greenton: I’ll explain the state of the car economy in about 2 minutes and 20 seconds. Are you ready? Set, go. The first problem is Jessica Caldwell, senior analyst at edmunds.com. After seven years of growth, does the decline in car sales mean that the good times in the auto industry are over?
JESSICA CALDWELL: I don’t think the good days are out. I mean, 2015 was a record year for new car sales, and it’s pretty good that we’re pretty much the same. We just don’t see the big growth we’ve grown accustomed to since the recession.
Greenton: Caldwell says American car companies have learned a real lesson. They’re selling cars that people want, and they’re making more money.
CALDWELL: they can quickly turn to any market volatility, they are likely to see this is very critical, because we’re not just talking about the United States, but we’re talking about, you know — the whole world is now in driving, this also is in the past ten years, the situation is different.
ASHKAY ANAND: my name is Akshay ANAND and I’m an analyst at Kelley Blue Book.
ANAND: I don’t think things will suddenly collapse, but at the same time, it does call on carmakers to start being more disciplined – right? – because it has long been a period of double-digit growth across the board. We just won’t see it again.
GLINTON: at the same time, EricLarman and truecar.com say car sales have peaked, but…
ERIC LYMAN: I think it’s more about industry demand. So we see that the macro picture is still very strong. We are close to full employment. Interest rates are still low. Credit is available. So there seems to be a low demand for cars.
Stephanie brinley: frankly, the pain of the recession is too close, and we still remember that it was too sharp.
Brinley: the industry is cyclical. You know, if we have seven years of growth, that’s unusual, that’s atypical. The real problem is that if sales shrink in 2017 or 2018, the industry will grow healthily.
Greenton: okay, the last analyst – the last word – Julius and Smith Moore is in st. Louis.
JULI NIEMANN: but car manufacturing is no longer the main driver of the economy as it used to be. This is just another consumer option.
Greenton: neiman said – someone remember that saying to general motors, what about the country? Yes, not that much.
NIEMANN: the auto industry has certainly made a huge contribution to economic growth, but it’s not going to sink us. It follows the economy. It will not leave the economy.
GLINTON: at least not now.
NIEMANN: not now.
GLINTON: ok. Thank you very much.
Brinley: you betcha (ph).