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Ford head Alan Mulally and the 2013 F-150. Mulally notes auto sales are a leading economic indicator, and all indications are good for the economy. Consider that through November Ford has sold 576,529 F-Series trucks, which is an 11.6% increase compared to the same period last year. Given that a whole lot of trucks are purchased nowadays for vocational purposes—by builders and tradesmen, for example—this is a solid sign. (Dodge Ram sales are up 20%, and while the Chevy Silverado is up just 0.1% and the GMC Sierra 4.4%, the ink is still black, not red.)
“With increased Elantra availability, thanks to the recently added third shift in our Alabama plant, and demand high for everything in our lineup from Accent to Equus, we’re looking forward to breaking our all-time annual sales record early in December” said John Krafcik, president and CEO, Hyundai Motor America, on the occasion of his company announcing that not only were its sales up 8% in November compared with record numbers in November last year, but that the company’s overall sales are up 8% for the first 11 months of 2012. And the Elantra sales, by the way, are up 28% compared with those of November 2011, which is a good thing that the Montgomery, Alabama, plant added those workers.
Krafcik was not alone in announcing sales increases in November. Like Jonathan Browning, president and CEO, Volkswagen Group of America, who said of VW, which is producing cars in Tennessee, “Significantly, the brand is now more than 100,000 units ahead of where we were this time last year.” The sales of the VW Passat, a car built at the VW plant in Chattanooga, are up 545.2% January through November 2012 compared with the same period in 2011.
Across the board, by and large, OEMs, be they based in Seoul, Wolfsburg or Dearborn (Ford sales this year are up a solid 5% compared with last year; to put things into perspective, whereas Hyundai has sold a total 643,572 vehicles in the U.S. through November, and VW has moved 394,128 cars and trucks, Ford has sold 576,529 F-Series trucks so far this year, which gives you an idea of the sots of volumes that we’re talking about here.) are finding the U.S. market, the one that was down on its knees not all that long ago, to be one where there is an abundance of potentially receptive customers.
Alan Mulally, Ford president and CEO, made an observation on MSNBC on the morning that the November sales figures were released: he pointed out that given that a car or truck is the second biggest investment that the average American is likely to make, second only to a place to live, the auto industry is a fairly significant leading economic indicator.
So, based on the numbers ticking up, and the volumes getting a whole lot better than 2011, which was a good year, the economic indicator seems to be that the recovery, fragile though it may be, is a recovery. Yes, an economic recovery. Things are continuing to get better. It has been a slow and steady increase, things like 545.2% increases notwithstanding.
Realize that the gain in this leading economic indicator are happening not just at the levels of compacts, midsizes and trucks, but even at the higher end of the market: Porsche North America announced that its sales in November were up 71% compared to November 2011, and its president, Detliv von Platen, said, “We see this demand continuing into the near future and may allow us to set a sales record this year.” Chances are, unless the company sells 0 cars in December, it will set a sales record.
OEMs are continuing to introduce new, fresh product. Competitive product. They understand that there are people who are beginning to realize that the car or truck in their garages may be on the aged side (the average age is nearly 11 years), and so they’re interested in getting something new. Given the plethora of pleasing product, you’ve either got to have something that’s really appealing, or—well, there probably isn’t an or. Unless the vehicle is well designed, engineered and manufactured, it isn’t going anywhere, literally and figuratively.