Weakness in autos, but it’s not as bad as it could be.
Seasonally unadjusted sales of light trucks (which includes SUVs) manufactured in North America fell 9.8% between October and November. That puts them 9.1% below the value for November 2006 and down 17.7% from November 2003.
Domestic cars (excludes light trucks) made up some of the difference, with sales up 1.2% month-to-month and up 8.5% year-to-year. That leaves November 2007 sales of domestic cars only 3.3% below the value of November 2003.
It seems reasonable to attribute the shift from SUVs to cars to higher gasoline prices.
Selling fewer trucks and more cars will help the U.S. in terms of fuel efficiency, but is not a wash for domestic manufacturers, whose total number of units sold as well as profitability per unit are both down. The November numbers thus represent a continuation of an unfavorable trend from the perspective of domestic manufacturers. The Wall Street Journal reported:
GM and Ford yesterday outlined production cuts aimed at keeping output in line with falling demand. GM said it would build 950,000 vehicles during the first three months of 2008, down 11% from the year-earlier period. Ford cut its first-quarter production forecast 7.4% to 685,000 vehicles.
On the basis of these numbers, we might anticipate motor vehicles to be one factor slowing GDP growth during the fourth quarter, though not precipitously.
Another key indicator of whether the fall run-up in fuel prices is making a difference for consumer spending are the surveys of consumer confidence conducted separately by the Conference Board and the University of Michigan. Both are beginning to give me some concern.