Now & Then

“We are at the bottom in the economic recession in the light vehicle market.”

“We’re still not out of the woods yet.”

“We haven’t cleaned up the financial mess quite yet.”

“We’ve fallen into a huge hole.”

“We are on the way back, but it will take us well into next year before we’re feeling better about the overall economy and market conditions.”

That’s George Magliano, director, North American Automotive Industry Research, Global Automotive Group, IHS Global Insight, from a mid-August teleconference about the economy in general, and the auto industry in particular.

Holes, woods, down, back, and out.

Bottom line here is that we’re getting there. Getting back. At the low point and beginning the climb back up.

Magliano thinks that while 2009 is the bottom, the vehicle market will not truly get back on track until 2012. That is, given a sufficient amount of time for people to feel confident about their finances—think everything from mortgages to credit card bills—to feel confident about their jobs—presumably all of the cost-cutting and downsizing will have worked its way through the system by then—such that they’ll start buying cars and trucks once again. And by 2014, we could be looking at a 17-million unit market again, with year-after-rear production increases from the nadir of now.

Looking at market share changes, Hyundai, while still a comparatively small player, is a big winner. Through mid-August, it gained 2.02 percentage points. Contrast that with GM, which is at the bottom, with a 1.9 percentage point loss of share. Chrysler, too, is losing ground, down 1.57. The other home-town team, Ford, is actually gaining share, up 0.69 percentage points, which is actually second to Hyundai. So far, Subaru, VW Group, Honda, BMW, Daimler, Nissan, and Mazda are also in positive territory (although Mazda is up only 0.03 percentage points, but that’s better than being down), while Porsche, Mitsubishi, Suzuki, and, yes, Toyota, join Chrysler and GM on the negative side.

Clearly, the economic situation is playing havoc with the order of things.

However, before people start getting too giddy, the projections of market share going forward indicate that Toyota will be in #1 spot in U.S. sales by 2010, then open up some white space between itself and GM/Ford, which will become very close to one another vis-à-vis sales during the next few years, which is quite an accomplishment for the team from Dearborn. Honda is projected to have a steady, comfortable growth to hold the #4 position, while Chrysler gets sandwiched between Nissan and Hyundai in the less-than-10% segment of the market.