U.S. light-vehicle sales were up 10 percent to 12.8 million in 2011 after a similar rise the year before. Forecasters expect another increase in 2012. It's a healthy market, too, with low incentives, manageable inventories and reasonable profit margins.
But stacked up against 2007, the last full year before the financial crisis, it's a dramatically different market -- a lot smaller and with share much rearranged among the top players.
Indeed, the contrast between that old normal and what might be the new one is huge when you look at the numbers.
Sales in 2007 were 16.2 million, 3.4 million higher than last year. That's a difference of more than 281,000 units a month on average.
Everyone knows that post-bankruptcy General Motors is on the upswing, with a 13 percent sales gain last year and a larger market share than it had in 2010. But it lost 1.3 million sales from 2007 to 2011 and 4.1 points of share.
"Even with the kind of growth we're projecting, we're still in recession-like industry sizes," said Don Johnson, GM's U.S. sales boss.
He says slow but steady growth would help GM "maintain that discipline" and not overproduce, as the industry often did in the 2000s.
Toyota Motor Sales is down almost 1 million units from 2007. Hammered by quality problems in 2010 and earthquake-related product shortages in 2011, Toyota is down 3.3 share points. A temporary blip? We'll see.
The outlier is Hyundai-Kia Automotive, which made it through the crisis in superb fashion, adding 358,701 sales since 2007 and grabbing 4.1 share points, to 8.9 percent of the market -- ahead of Nissan North America and on the heels of No. 5 American Honda Motor Co.
Some other winners and losers since 2007:
-- Nissan/Infiniti gained 1.6 share points since 2007, the best showing of any Japan-based automaker.
-- Ford Motor Co., which launched an ambitious turnaround strategy before its Detroit rivals and avoided bankruptcy, has added 1.0 points of share.
-- Chrysler Group, even with a 2011 sales surge, is still 2.2 share points lower than in 2007.
-- American Honda lost 0.6 points of share, falling to 9.0 percent.
Sales have become more widely dispersed among carmakers since 2007. Smaller players, those outside the top seven, have increased their slice of U.S. sales to 14.1 percent, from 10.4 percent.
Four manufacturers accounted for most of that 3.7-point gain. Volkswagen Group of America has parlayed investment in marketing and a new Tennessee assembly plant into a 1.5-point gain.
Subaru, Daimler AG and BMW have picked up a combined 1.8 points.
Most executives and analysts say they understand that the "old normal" era -- nine straight years with sales above 16 million from 1996 to 2007 -- is over.
But they aren't sure what the new normal will be.
Analyst Jesse Toprak of TrueCar.com reckons that 14.5 million is a realistic average market size in the new era.
"We're still finding the new normal and we won't approach it until at least 2013," he said.
"But the industry's breakeven point is still 11 million, so this year should be very profitable for most."
IHS Automotive analyst Rebecca Lindland's "new normal" is 15.5 million to 16 million annual sales.
"That's a level that is sustainable without a lot of shenanigans," she said. "The industry can be very profitable at that level and yet flexible enough to contract if necessary."
Virtually all carmakers expect higher 2012 volume as the economy picks up and Toyota and Honda fully restore post-quake inventories.
"Timing is everything," said Toyota Motor Sales U.S.A. President Jim Lentz.
"We are entering a growing market that will grow 1 million units, in an improving economy, with growing interest rates, with 19 new and refreshed models to launch," he said.
GM's Johnson is encouraged by the Toyota and Honda recoveries.
"That brings back some buyers into the market who may have sat on the sidelines," he said. "We will get a shot at them."
Johnson expects to build on GM's 13 percent sales growth, which boosted its 2011 market share by a half point to 19.6 percent. GM is predicting industry sales of 13.5 million to 14.0 million in 2012.
Ellen Hughes-Cromwick, Ford's chief economist, said economic fundamentals are improving and that will help auto sales grow.
"The latest statistics show some very positive momentum," she said.
Toyota sees 13.6 million sales in 2012; Chrysler forecasts 13.8 million, and Volkswagen echoes GM at 13.5 million to 14 million.
Ford expects 13.5 million to 14.5 million, including medium- and heavy-duty trucks, which means about 13.2 million to 14.2 million light vehicles.
Toprak says the midyear sales stumble of 2011 may turn out to have been better for the industry than a rapid acceleration.
"This may be a healthier, more sustainable pace," he said. "It turned out to be a year of stable growth."
Toprak expects 13.8 million sales in 2012, which would be an increase of 8 percent.
Lindland said today's auto market is vastly improved from the 2007 version.
"It's much healthier," Lindland said.
"We got rid of the fast food -- the bad habits and the need to make products because it was cheaper to make them than not make them."
(Automotive News, 01/09/12)
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