On Monday, U.S. manufacturers will announce – as much as they hate it – last month’s sales. It is expected that sales have dropped in December by “48 percent from a year earlier at Chrysler, 41 percent at GM and 33 percent at Ford,” based on the average estimates of analysts surveyed by Bloomberg. The oracles expect a likewise bloodbath amongst the Nipponese: “Toyota Motor Corp. may report a 40 percent slide and Honda Motor Co. may say its total was down 36 percent,” said Brian Johnson, a Barclays Capital analyst in New York.
The actual numbers reported by the manufacturers will provide fodder for the dreaded SAAR, which will also be announced for December. No, it’s not a disease that will wipe out China, although it might cause similar symptoms. It’s the Seasonally Adjusted Annual Rate for the month. It’s a statistician’s shorthand for “how many cars would we sell for the next year if people’s buying habits stay exactly like the last month?” For all we know now, the December rate will probably be the worst in insert-the-appropriate-timescale-here.
Bloomberg may have a bunch of analysts to ask. TTAC has the combined brainpower of the Best and the Brightest. So we ask you: What will be the December SAAR on Monday?
Some things to consider:
– Price of gas is way down.
– Toyota started 0 percent financing in October, with little effect
– GM began a “Red Tag” sale 10 days early this year on Nov. 15
– Ford introduced employee’s pricing on Nov. 19
– The loose money GMAC loans came too late for December
– The sky is falling
– This is the end of the world as we know it
All of this had (hopefully) been factored in by 10 analysts which Bloomberg had already asked. Here are their dreadful projections for the December SAAR disease:
Patrick Archambault (Goldman Sachs) 9.5m
Christopher Ceraso (Credit Suisse) 10.2m
Christopher Hopson IHS Global Insight) 9.7m
Richard Kwas (Wachovia) 9.9m
Erich Merkle(Crowe Horwath LLP) 10.7m
Itay Michaeli (Citigroup) 10m
John Sousanis(Ward’s Automotive) 9.9m
Jesse Toprak (Edmunds.com) 9.8m
Now B&B, place your bets: What will be Monday’s SAAR for December? Those who come closest to the official Monday result will be bestowed the coveted title of AFB&B (AbsoNSFWingly Best & Brightest.) Contest closes Sunday, January 4, TTAC system time.
Put me down for 10.8m.
9.6m and 1, Bob!
9,750,000. Most of the Big 2.333 dealerships I have passed in recent weeks have looked like graveyards…..While I waited for a red light next to a dealer the other day, I didn’t even spot a salesman in the showroom but the neon sign said “open”. Not a soul around.
10.1 Million.
As a side note, I went into a Kia dealer on the 15th of Dec. Largest Kia dealer in the area (East TN), until they went out of business a couple of days ago. It was strange. I had a personal salesman and finance guy the whole time I was there–other workers of various functions frequently strolled by and said hi, offered coffee, etc… They were so helpful it was borderline uncomfortable.
Whatever it is 2009 is going to be a lot worse than 2008. And there is no recovery in sight.
The government cure of printing and borrowing more money to spend is gonna cause an economic mess the likes of which we have never seen. If it was that easy why not just give everyone a million dollars?
like bluecon said:
doesn’t really matter, 2009 will be worse…
i vote:
9.873 million for the december saar…
new vehicle sales for 2009 should be below 9.3 million…
All I know is if GM’s monthly sales are off 40% (or greater, of course :) from last year’s figures, …and if Chrysler’s monthly sales figures are off 50% (or greater, of course :), then 2008 will have ended on a very positive note.
Question of the Day: “In these most-difficult and trying times, how are YOU going to spend $1100 on your GM transmission when it fails you?”.
10.7 Mln. But, that’s just me; I’m an optimist!
Put me down for 9.2 million. My first place prize is a date with a professional female volleyball player.
10.4 @ luscious 38 years driving, 8 new can’t count how many used GMs.One 81 Monte Carlo that smoked a metric 200 transmission.60,000 KLMS way out of waranty GM split the bill.
And now the Democratic party strategist on Cavuto on Business Saturday morning is calling for a huge increase on the gasoline tax. Just what the bankrupt 3 and the economy need.
9.5 million. How sad.
Year-over-year stats conceal the reality of Detroit’s decline. If Toyota drops 40%, it will be from an up-year that followed a long series of annual gains. GM’s drop, on the other hand, will be off a down year.
If what we’re trying to get a sense of is the condition of the individual auto companies, the base year for comparison ought to be a few years back.
FWIW, that applies to benchmarking housing prices, too. For instance, in many areas, the peak was back in 2006. A price (say) this coming July that shows as down 15% YOY might be 50% or more off the peak — a true meltdown, not just a 15% adjustment.
It’s not just that sales numbers are dropping; it’s the discounts to MSRP that are being given to make the sales happen.
I bought a new 2008 Ranger in December for $4700 off MSRP. Ford got a sale but how much money did they make on that truck? Less than a year ago I suspect.
Would you please pick your SAAR number when you post? Thank you. Alright, mine is 9.9m . And I’ll also take a female volleyball player as long as she isn’t blond.
9.65 Mln
9.79m
And a pinch to grow an inch.
All of it is B.S. Kind of like playing Liar’s Poker with pathological liars.
9.95m
When I went to get my Subaru oil changed last week and walked around the Cadillac lot while I waited. I showed the tiniest interest in a CTS and the guy threw the keys at me and told me to drive it, didn’t even ride around with me or ask me for my last name. The Ford dealer I went to after that only had one salesman in the entire place and he didn’t look interested in showing me the Escape and Flex I wanted to look at for my parents. Other than the service department at both dealers there wasn’t a customer to be found.
Call me a pessimist – I’ll vote for 9.0 million and more losses to come.
When discussing large corporations it’s useful to remember that their employees are also their customers. Maybe that’s oversimplified but it’s still true.
So when BigAutoCo lays off employees or defers improvements in product or physical plant the people who would have been paid for those things have to do without. And since a new car is not a necessity (the same old one or a cheap used one will do) this is where the affected consumers cut back first. This further reduces auto sales and the cycle continues until the bottom is reached.
Of course, the reality is that the situation is much more complex – but the same general rule still applies.
Less income = fewer products purchased = less production = fewer workers employed = less income.