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The Decline in Automobile Market in America Is Expected to Continue in 2018

Decline in Automobile Market in America

Automotive | Jan, 2018

Following seven straight years of growing domestic vehicle sales, automotive OEM’s revealed a decrease of around 1.8 percent in 2017, to 17.2 million cars and light trucks.

As per automobiles industry experts the decline in the industry is still going to enter the year 2018 as well. Yes, the auto industries long-running deals has arrived at an end. The country which was doing exceptionally well in the auto industry why its showing such decline in the sales? What are the reasons behind the sales. A few factors that pushed the upward swing are currently blurring or evolving course. Outstandingly low financing costs are turning higher. What's more, quality has enhanced, consumer loyalty studies have appeared, such a significant number of Americans are keeping their vehicles longer.

Moreover, during the recession period, purchasers and organizations put off purchasing new vehicles. At the point when the economy enhanced, many hurried out to replace the cars they'd been driving, sales were up a seemingly endless amount of time. But now everything seems to be changed now.

Seems like a challenge for the automobile manufacturers, right?

This has become a big challenge for the automobile industry, if Trump administration exchanges major changes to the North American Free Trade Agreement, then the traffics can be imposed on vehicles specially in Canada and Mexico. Manufacturers are likewise endeavouring to push ahead with self-driving and electric vehicles even as it stays hazy what number of they will have the capacity to offer, and till when.

Not only this, but the fuel prices are also affecting the sales. The prices are still not very high if we compare but are quite changes as compare to $2.35 a gallon for gas a year ago and now it’s around $2.49 gallon for regular gas.

As sales moved during last seven years, carmakers needed to stress minimal over keeping their plants murmuring. Presently they are worried about cutting the vehicle production and discovering approaches to lure clients to purchase the vehicles. It’s a big challenge for the automobile manufacturers.

                                                                                                                  Source: OICA

After the financial crisis, this is the first time when the sales of light vehicles declined in 2017. Americans tend to buy cars when gas costs are high, and trucks when costs are low, yet this time the move to trucks has been aggravated by an expanding inclination for taller, roomier vehicles. That has constrained carmakers as of late to move the creation blend quickly to accentuate brandish utility vehicles, minivans and light trucks. Moreover, the manufacturing of electric vehicles is increasing like anything as the demand for electric vehicles in the country is increasing and the government’s stringent rules for using the electric vehicles and incentive schemes are pushing the consumers to buy electric and hybrid vehicles.

According to Techsci Research “Global Small Electric Vehicle Market By Technology (Hybrid Electric Vehicle, Plug-In Hybrid Electric Vehicle, Battery Electric Vehicle), By Battery Type, By Geography, Competition Forecast & Opportunities, 2022”, market stood at around $ 6 billion in 2016, and is forecast to grow at a CAGR of 23% during 2017 – 2022, to reach $ 20.7 billion, on account of increasing consumer inclination towards electric passenger cars coupled with declining prices of electric vehicles.

Moreover, the boost in demand for small electric vehicles can be attributed to favourable government policies and continuing surge in R&D investments by several OEMs to develop premium quality and affordable small electric vehicles. All the above stated factors along with growing penetration of small electric vehicles in developing economies are anticipated to positively impact the market over the course of next five years.

                                                                                                                                                                                          Source: Techsci Research

According to Techsci Research, Research Analyst, Electric & hybrid vehicle market is still at a nascent stage. Huge upfront cost has been a key barrier which has been restricting the growth of the global electric vehicle industry. With increasing investments from several automobile manufacturers which are entering into the small electric vehicle market, the market has grown prominently over the last few years and has attained a noticeable market in the overall automobile industry. Major investments by several big giant OEMs including such as Tesla, Nissan, BMW, Toyota, Ford, Audi, etc., are anticipated to propel the global small electric vehicle market during forecast period.

Let’s look at the OEM’s sales figures:



December Sales (Approximate Numbers)

Percentage Change

Market Share

General Motors




Ford Motors




















Source: Company Profiles & Techsci Research

A month ago, the sale of General Motors mirrored that move. The organization had a solid December in trucks, offering more than 94,000 full-measure pickups between its Chevrolet and GMC brands, very nearly 33% of its aggregate deals. Be that as it may, its general deals still fell 3.3 percent from the past December, as cars like the Chevy Malibu and Impala grieved on dealer’s lot.

For a compete one year, the GM’s sales percentage declined by more than 1 percent which is around 3 million vehicles and that’s a big number. Not only GM faced a tough sales period, but Fiat also faced a tough ride on the previous year. Its sales declined by over 10 percent and in 2017, the total sales of the company dropped by over 8 percent which is around 2 Million vehicles.

But if we talk about only December month, the sales of the company rose. The company become among those few manufacturers who looked at a growth in the month after GM by selling F-series models. But for the full year, Ford is no where in the good books of the sales and its sales dipped by almost 1 percent to 2.6 million vehicles.

It’s challenging for every company and this decline might force OEM’s to trim production and find new ways to entice customers.

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