U.S. auto sales slump amid recovery doubts

It seems car buyers in the United States are not in a buying mood.

Firms in the U.S. that track auto sales are predicting a sales slump from 9.5 per cent to 12 per cent from May to June of this year, likely driven by growing consumer concerns about the state of the economic recovery and poor job figures for the last few months. An index on consumer confidence showed a dramatic 10-point drop in consumer confidence.

Yesterday, world stock markets along with Wall Street expressed their own concerns about the world’s economic health by posting declines. Today, the European markets showed some small gains with t the Euro Stoxx 50 index of euro-zone blue chips rose 0.2 percent, while the FTSE 100 index in London gained 0.3 percent. On Tuesday, the overall European market was off about three per cent. The Standard & Poor’s 500 index futures were up 0.5 per cent after a sell-off on Tuesday that took the index down 3.1 per cent.

“The two big issues with consumers right now are employment growth and income growth, and they are not seeing much of either,” says George Pipas, Ford Motor Co.’s sales analyst.

According to sales figures, automakers sold 1.1 million cars in May. J.D. Poewr and Associates, Truecar.com and Edmunds.com are saying June will show sales bellow one million. In comparison, the last five years June sales often came in at 1.3 million car sold and in 2005, 1.7 million cars were sold in June.