North American auto production to drop 4%: J.D. Power

WESTLAKE VILLAGE, Calif. (Dec. 12, 2002) — Market research firm J.D. Power and Associates yesterday forecast a 4-per-cent drop in North American light-vehicle production during the first half of next year compared with the same period the year before.

The decrease represents about 350,000 vehicles, said Jeff Schuster, director of North American forecasting for J.D. Power. He attributed the forecast to growing inventories and “the fact that consumers are becoming numb to a $2,000 US average sales incentive.”

Schuster predicted that North American auto and light truck production would dip to 16.1 million units over the entire year in 2003.

“The lost volume will not be shared equally among producers, as new model activity at Honda, Nissan, and Mitsubishi will drive their production volume higher in 2003,” Schuster said. Despite redesign and new model activity at General Motors and DaimlerChrysler, J.D. Power and Associates expects the traditional Big Three share of production to fall to an all-time low of 73 per cent, down from 75 per cent in 2002.

J.D. Power said its forecasting method uses new-vehicle retail transaction data from more than 5,900 participating auto franchises in 26 U.S. markets.