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Peak US car sales?

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Peak US car sales?

Unread postby EdwinSm » Thu 13 Jul 2017, 05:54:44

Why are US car sales falling?
Car sales in America - the world's second-largest market - are stalling, but there's debate about whether the downshift is due to normal economic cycles or a sign of bigger changes.

http://www.bbc.com/news/business-40523171

The fall is not expected to be big - only 3% this year [so this is not a Doom story :roll: ], and the 'experts' seem unsure whether this is cyclical or a changing pattern. I noticed the electric cars do not even get a mention as a reason for dropping sales :P, but emphasis is on changing generational patterns of car buying.

I don't suppose one year's small decline will make much of a change in fuel consumption, but several year of such delcine (if it is not cyclical) might start to make a noticeable difference.
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Re: Peak US car sales?

Unread postby Outcast_Searcher » Thu 13 Jul 2017, 10:51:41

EdwinSm wrote:
Why are US car sales falling?


The fall is not expected to be big - only 3% this year [so this is not a Doom story :roll: ], and the 'experts' seem unsure whether this is cyclical or a changing pattern.

Right. And from the article:

They come after a record 17.55 million cars, SUVs, minivans and pick-up trucks were sold in 2016.
Forecasters expect US sales to fall to about 17 million this year, as demand recedes after years of increases.

This looks FAR more like fluctuation than doom in the short term. Earlier this year when lower numbers were coming in, economists and pundits were fearful that this meant a US recession was "likely", and were worried about far larger declines.

I see this as noise, in the short run, especially given how strong the sales ramp has been in recent years.

We'll have to see how various things occur (timing, and speed of ramp) in cars for the next several years (things like EV sales, whether automated cars start to become "a thing" instead of a concept being tested, etc) before some of the "bigger changes" can be evaluated.

For example, either EV's lasting a lot longer, or cheap rides in automated cars could put SERIOUS downward pressure on car sales. The key word there is COULD, and we don't know how quickly.
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Re: Peak US car sales?

Unread postby AdamB » Thu 13 Jul 2017, 21:14:29

EdwinSm wrote:
Why are US car sales falling?
Car sales in America - the world's second-largest market - are stalling, but there's debate about whether the downshift is due to normal economic cycles or a sign of bigger changes.

http://www.bbc.com/news/business-40523171

The fall is not expected to be big - only 3% this year [so this is not a Doom story :roll: ], and the 'experts' seem unsure whether this is cyclical or a changing pattern. I noticed the electric cars do not even get a mention as a reason for dropping sales :P, but emphasis is on changing generational patterns of car buying.

I don't suppose one year's small decline will make much of a change in fuel consumption, but several year of such delcine (if it is not cyclical) might start to make a noticeable difference.


I'm speculating that there is a more practical reason for the drop, related to how lucrative car loans have become, similar to the kind of problem that happened in housing circa 2007-2008.

http://asia.nikkei.com/Markets/Tokyo-Ma ... car-crisis
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Re: Peak US car sales?

Unread postby dolph » Fri 14 Jul 2017, 00:14:55

Regardless of whether or not it is declining, think about what a staggering number that still is. Absolutely incredible number.

Land of the free, home of the brave?

How about land of the cars and home of the debt slaves.
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Re: Peak US car sales?

Unread postby Outcast_Searcher » Fri 14 Jul 2017, 17:02:42

dolph wrote:Regardless of whether or not it is declining, think about what a staggering number that still is. Absolutely incredible number.

Land of the free, home of the brave?

How about land of the cars and home of the debt slaves.

Is 17 million really so "incredible" in a country with nearly 20 times that many people? Given that ICE's tend to get less reliable after 10 years or roughly 200,000 miles of service, I'd say not.

Now, in a rational world, there would be one HELL of a lot more/better mass transit in cities, but the US isn't that world in many respects.
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Re: Peak US car sales?

Unread postby Cog » Fri 14 Jul 2017, 17:10:44

What car sales show is that there still remains a considerable amount of disposable income. At least enough to service debt. So much for doom.

Ford and GM are still turning a profit. Still getting my 5% dividends.
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Re: Peak US car sales?

Unread postby baha » Mon 24 Jul 2017, 07:10:10

How many people these days can afford a $50k pick-up truck and a 6-8 year loan just so they can tow their bass-boat?

I think this is another sign of wage inequality. Just like health care, the auto industry is pricing themselves out of range of normal people. The millennials have no choice but to find another way...Lyft...

We are in transition, the system can't support itself at these levels, everything will be downsizing.
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Re: Peak US car sales?

Unread postby AdamB » Mon 24 Jul 2017, 08:31:36

EdwinSm wrote:I don't suppose one year's small decline will make much of a change in fuel consumption, but several year of such delcine (if it is not cyclical) might start to make a noticeable difference.


Indeed. Inflection points in demand patterns are part and parcel of energy experts discussing the timing of peak demand for oil as well.

<warning...actual energy expert referenced>

http://www.resilience.org/stories/2015- ... -excerpts/
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Re: Peak US car sales?

Unread postby EdwinSm » Mon 24 Jul 2017, 09:23:24

Thanks for that link Adam... I don't have time now to study it (just a quick read through), but it looks interesting with the talk of peak demand and the 'techincal' reasons the author expects for it.

Also interesting is the report of falling demand, not just in Europe, but also in the States.

I will come back to the article again (even if I don't make more comments on it).
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Re: Peak US car sales?

Unread postby AdamB » Mon 24 Jul 2017, 12:38:31

EdwinSm wrote:Thanks for that link Adam... I don't have time now to study it (just a quick read through), but it looks interesting with the talk of peak demand and the 'techincal' reasons the author expects for it.


I noticed recently in an EIA graph from the AEO2017 that they have been putting together energy intensity charts, expected gains in efficiency over the next 20-30 years. What was interesting about those charts wasn't what is expected (it is the future, who knows what might happen) but the historical gains, happening consistently and right on through today.

Those technical reasons were doing what they do for decades before this website came to life, no one has been able to show they will suddenly stop now, so running down that path doesn't seem like a bad idea.

EdwinSm wrote:Also interesting is the report of falling demand, not just in Europe, but also in the States.


It ties in with some other articles I've noticed mentioning behavioral changes amongst the youngsters, more urban orientation, car sex appeal isn't what it once was (having been replaced with phone sex appeal?), and a host of things, not least among them that cars really aren't good for us, ultimately.

In either case, this tends to be good news, and comes straight from reality. Hence I expect to be roundly rebuked for it by the usual suspects. :lol:
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Re: Peak US car sales?

Unread postby EdwinSm » Tue 25 Jul 2017, 00:44:08

While not worldwide Peak Oil the article Adam referenced has the USA having a Peak Oil (Demand) in 2007.

The U.S. Energy Information Administration declared 2007 as the peak year for oil use in the U.S., with demand expected to fall by between 1.8 million and 2.7 million barrels a day by 2035 based on improvements in automotive efficiency and demographic trends


Maybe some of the doomers were not so far off with the date, although the figures show only a small fall not a cliff like decline. :roll: :shock: :P :oops:
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Re: Peak US car sales?

Unread postby rockdoc123 » Tue 25 Jul 2017, 12:29:10

While not worldwide Peak Oil the article Adam referenced has the USA having a Peak Oil (Demand) in 2007.


A regional analysis of consumption/demand for oil is not indicative of whats going on in the global economy for a couple of reasons. It is pretty clear that although US consumption of oil dropped after 2007 and hasn't yet got back to where it was, car sales and especially SUV sales have been increasing. That suggests that at least part of the drop in demand is a function of better efficiencies in vehicles and perhaps a slight upsurge in EV sales. But on a global basis oil demand has been on a more or less continuous rise. What ever drop was recognized in the US it was more than compensated by an increase in Asian demand.
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Re: Peak US car sales?

Unread postby AdamB » Tue 25 Jul 2017, 12:38:05

EdwinSm wrote:While not worldwide Peak Oil the article Adam referenced has the USA having a Peak Oil (Demand) in 2007.

The U.S. Energy Information Administration declared 2007 as the peak year for oil use in the U.S., with demand expected to fall by between 1.8 million and 2.7 million barrels a day by 2035 based on improvements in automotive efficiency and demographic trends


Maybe some of the doomers were not so far off with the date, although the figures show only a small fall not a cliff like decline. :roll: :shock: :P :oops:


Doomers never really focused on much but the supply side. I was running through the archives a few days ago and noticed that someone with more than a few functioning neurons noticed that price is a function of supply AND demand, so peak oil might be completely irrelevant if demand causes it, or drops at the same rate, or greater, than supply. That is just basic Econ 101. However, it also makes peak oil irrelevant, so obviously back in the archives the usual suspects rounded on and devoured the poor bastard who actually KNEW something. Similar to what goes on now, except there were far more doomers back then. The smart ones having compared reality to what they thought was going to happen, and having realized that they had been pretty ignorant of more than a few sciences that had something to say on the matter that they hadn't recognized in real time.
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