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A “Seismic Shift in Consumer Preferences” for the Auto Industry

Shannon Arvizu | Wednesday April 9th, 2008 | 2 Comments

Total vehicles sales have dropped 12% in the U.S. since March 2007. Why? What does this mean for the future of the auto industry?

Double-digit declines have occurred for four major carmakers (Ford, GM, Toyota, and Chrysler) in the last year. The Wall Street Journal attributes this to three reasons: (1) high gasoline prices, (2) a weak job market and (3) a “credit crunch” that now requires consumers to have higher credit scores and larger down payments.
The sales slump has hit almost all major models, except for fuel-efficient compact vehicles. “This is a very challenging external environment, reflecting a seismic shift in consumer preferences,” said Ford’s Mr. Farley.
Such a shift will necessarily aid the growth of alternative vehicles, such as plug-in hybrid electric vehicles (PHEVs) and neighborhood electric vehicles (NEVs) that offer far more fuel savings over the lifetime of a conventional car. Companies that currently offer such cars are in the minority now, but I predict that major automakers will begin to take their lead and develop similar vehicles in order to increase their sales.


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  • http://www.bikecommuter.com J

    Its not rocket science folks : ) Enjoy the ride.

  • http://generalgyaan.blogspot.com Gaurav

    And how would this impact TATA acquiring Jaguar and LandRover. Was the timing correct? Why would have Ford sold it in the first place?