VTM, auto sales data: is the automobile era teetering?
July 2nd, 2009U.S. auto sales are still falling off a cliff.
From MarketWatch: General Motors U.S. June sales decline 33.6% – worse than the 29% drop in May. Toyota June U.S. sales were down 32% to 131,654 units. Chrysler June U.S. sales were down 42% to 68,297 units. Honda posted a nearly 30% sales decline, while Nissan posted a 23% drop in sales. Ford is bragging about picking up market share as sales beat projections and declined by only 11% instead of the expected 16%.
The annual rate fell to 9.69 million cars and light trucks last month, from 9.9 million in May and 13.7 million in June 2008. Sales are on pace to be the worst since 1967.
In 1967 there were 103 million drivers and 9.54 million light vehicles sold; now there are about twice that many (205.7 million licensed drivers in 2007). Compared to the number of drivers, the current sales rate is the lowest since the BEA started tracking auto sales.
People are driving less, too. The number of miles traveled by motor vehicles in the U.S. peaked in November 2007. Since then, the 12-month total has dropped by 123 billion miles, or slightly more than 4%. That’s a bigger decline than the drop of just above 3% during the 1979-80 Iranian revolution that triggered a spike in gasoline prices.
The Federal Highway Administration reports that VTM rose slightly in April, up 0.06% over April 2008 (April is the latest month for which there is data). Travel in the West was up 1.3%. Cumulative Travel for 2009 is still down 1.1%.
Is April an anomaly, or does it portend a reversal of trend? The April data is preliminary, and could be revised away. And gas prices are rising again – the average U.S. price for regular-grade gasoline, at $2.62 per gallon on June 8, was almost 60 cents per gallon higher than its price at the end of April.
Why exactly are we spending billions of “stimulus” money on building roads if driving is dropping and auto sales are plunging? Our strategy requires the reversal of those trends – a return to vigorous auto sales and a revival of the suburban project.
But as John Michael Greer points out, economics doesn’t trump physical reality. What we call “economics” developed during the three-hundred-year boom that created the industrial world following the successful harnessing of fossil fuels. During that period, limits to growth rarely applied. Pumping up demand in a situation where there are physical constraints to growth is a strategy doomed to failure.
Our economic policies reveal the hollowness of our proclamations of concern about climate change. Our policy actions embody a blithe disregard for the limits of a finite planet.