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The
U.S. market could hit a cyclical trough at about 15 million
vehicles for the year in 2019 as interest rates rise and used
vehicle prices fall, said Mark Wakefield, head of AlixPartners'
automotive practice in the Americas region. The firm projects
U.S. sales of 17.1 million cars and light trucks this year and
17.4 million in 2016.
AlixPartners forecasts annual global vehicle sales will grow to
103.2 million vehicles in 2021 from 87.9 million projected for
2015. The annual rate of growth for the next seven years will be
slower than the 3.1 percent pace from 2007 to 2014, when demand
in many markets was recovering from the financial crisis.
China’s auto market, the world's largest, will grow at a 5.2
percent rate through 2018, decelerating from a 16.6 percent
annual rate from 2005 to 2014, the consulting firm forecast.
Low oil prices could keep sales in the U.S. above 17 million
vehicles annually through 2017, AlixPartners forecast. Wakefield
said low gasoline prices could cause problems for automakers,
because consumers could wait nine to 13 years for fuel savings
to repay the additional $3,500 a vehicle in added costs for
technology required to meet tougher U.S. fuel economy targets.
“You’re fighting the consumer now,” when the payback for
technology goes beyond the six years that most consumers keep a
new vehicle, Wakefield told Reuters.
Wakefield said he doesn’t expect the U.S. government will back
away from its target for automakers to offer vehicle fleets that
average 54.5 miles per gallon in government testing. But
automakers could get additional credits that could allow them to
field fleets that emit more greenhouse gases, and burn more
fuel, in everyday driving.
Still, automakers are moving to increase the levels of
electrification in cars – using hybrid power systems and
technology that replaces mechanical and hydraulic brakes or
power accessories with systems that operate electronically,
Wakefield said.
(Reporting By Joe White; Editing by Andrew Hay)
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