A record-high U.S. average vehicle age all but assures an uptick in new-vehicle sales next year, but the rate is contingent on the economy’s health, saysCo.’s senior economist.
The average vehicle on today’s roads is 10 years old, says Yingzi Su. Sagging consumer confidence boosts that number, along with improved durability.
Combined, they contribute significantly to pent-up demand. But there is hope.
“Pent-up demand will always be released gradually,” Su says today during a teleconference with journalists and industry analysts. “Even now, it is being partially released.”
Su’s remarks come as GM records a 7.5% sales increase in November, according to Ward’s data, which is adjusted for selling days – 24 last month, compared with 23 in like-2009.
But last year’s comparison includes sales totals from GM’s discontinued Pontiac, Saturn and Hummer brands. Expect them to disappear from the auto maker’s balance sheet in early 2011, says Jim Bunnell, general manager-dealer network and sales support.
There were just 64 legacy-brand units on dealer lots as of Nov. 30, the auto maker reveals.
Bunnell says GM is prepared for a turnaround in the soft market. As of Nov. 30, the auto maker says it had 535,934 vehicles in stock – 365,587 cars and 170,347 trucks.
That represents a 4% hike from prior-month’s 515,394, according to Ward’s data.
“As you look out into 2011 and you see strong demand, growing demand in the marketplace, we think it’s the right position to be in,” says Bunnell who expects “gradual” improvement in the sales climate.
“Dealers ask me for more product continuously,” he says.
The car-vs.-truck inventory split belies November’s sales mix.
GM suffered a 5.5% dip in car sales last month, compared with like-2009. This was offset by a 15.7% jump in light-truck deliveries.
Top volume performers in each segment were the Chevrolet Impala sedan and Chevrolet Silverado fullsize pickup, with tallies of 14,693 and 25,619, respectively.
Chief gainers in percentage terms were the Chevy Aveo C-car and Chevy Equinox cross/utility vehicle. Their sales soared 41.3% and 53.8%, respectively.
In September, GM added capacity to build the Equinox and its platform-mate GMC Terrain. The auto maker now is shipping bodies from its plant in Ingersoll, ON, Canada, for final assembly at its manufacturing complex in nearby Oshawa, ON.
The Ingersoll plant, which assembles only the Equinox and Terrain, also is on a 3-shift production schedule.
Bunnell says fleet sales rose last month, but not the daily rental variety. Higher-margin commercial business rocketed 44%.
On the downside, November sales of the high-profile Chevy Camaro muscle car plunged 41.9%, compared with like-2009. But a convertible version is expected on dealer lots by February.
On the brand level, Chevy, Buick, Cadillac and GMC all were in positive sales territory last month.
Through November, GM sales were tracking 7% ahead of like-2009, according to Ward’s. Despite a 141.2% surge by the auto maker’s Buick brand, the auto maker’s total car deliveries lagged 5.8%.
Meanwhile, light-truck demand outpaced prior-year by 16.5%.