ACME, Mich. – Americans will be buying between 16 million and 17 million new vehicles a year by 2015, according to one analyst who says the industry’s recovery is in its early stages.
Itay Michaeli, an analyst with Citi Investment Research, also said it’s not true that pent-up demand – buyers who must replace 15- to 20-year-old vehicles – is driving the recovery. He notes sales went up last year even though the U.S. fleet aged, meaning pent-up demand had “zero” impact on sales.
The Center for Automotive Research, sponsor of a conference this week at Grand Traverse Resort here, has a more conservative forecast: U.S. sales of only 15.4 million this year; 15.7 million next year and growing to 15.9 million for 2015 and 2016, said Sean McAlinden, chief economist for the Ann Arbor, Mich., research center.
R.L. Polk data released Tuesday shows the average age of all light vehicles on the road now stands at a record of 11.4 years, based on a review of over 247 million U.S. car and light truck registrations earlier this year.
A main reason for caution: Job creation is modest at best.
“No matter how you look at it, this has been a subpar recovery,” said Mustafa Mohatarem, General Motors’ chief economist. “Companies are just not hiring.”
At GM, “we planned for the recovery and put capacity in place,” Mohatarem said of pickup demand. The plan has not deviated from the start of the year, when GM was preparing to launch the new family of full-size pickups that are now on sale.
From 2001 to 2010, millennials – those born after 1980 – have seen a 44.2 percent decline in their net worth. Their income has fallen 6 percent and student loan balances grew 91 percent, said Anthony Pratt, director of forecasting for R.L. Polk.