Long haul for US market recovery

Autoremarketing.com, a website dedicated to used car marketing in the US, has reported a pessimistic forecast for the American new-car industry from statistician R.L. Polk & Co.

Looking forward to the end of this year, Polk predicts that the American market will constitute just 10.7 million new-car sales, a 19 per cent reduction compared with sales for 2008. As it stands, the 2008 market was 17 per cent down by comparison with the 2007 market.

According to the director of consulting and analytics at Polk, Lionel Yron, the ability of the American market to bounce back to previous levels as high as 16 million units will be predicated on the effect of the US government's economic stimulus package.

"With the inability to use rising home prices to generate liquidity and tighter lending rules, Polk sees the U.S. market stabilizing around 16 million units within three to five years depending on the efficiency of the government stimulus package," he was quoted as saying.

Global car sales are expected to slump 13 per cent this year. Plainly the American market has contributed to that average being worse. The company expects Western Europe to account for 13.5 million units this year, a 12 per cent slide from last year. In Asia, excluding Japan, will contribute 12.4 million sales, down from 13.3 million in 2008.

Based on the forecast for the Australian market from the Federal Chamber of Automotive Industries (FCAI), the 2009 sales tally will be 880,000 units, a roughly 12 per cent decline from 2008.