2003 North American Automotive Production Forecast Lowered to 16.1 Million Units

WESTLAKE VILLAGE, Calif., Dec. 11, 2002; J.D. Power and Associates has lowered its 2003 North American light-vehicle sales forecast to 16.1 million units. The forecast leverages Power Information Network (PIN) real-time transaction data coupled with the firm's Automotive Forecasting Services.

"Our concerns with growing domestic inventories and the fact that consumers are becoming numb to a $2,000 average sales incentive have led us to lower our North American production forecast to 16.1 million units for 2003," said Jeff Schuster, director of North American forecasting at J.D. Power and Associates. "With a slowdown in sales going into 2003 being the primary driver, we expect production to be down nearly 350,000 units, or 4 percent, in the first half of the year compared with the same period in 2002. 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."

In fact, even with respectable 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 percent, down from 75 percent in 2002.

Utilizing its PIN Pulse Monthly Sales Forecast results -- which have proven to be an industry leading indicator -- to fine tune North American automotive production forecasts, J.D. Power and Associates has increased its forecast responsiveness and data integrity down to the model level.

"PIN Pulse Forecast data produced a phenomenal 99 percent accuracy during the last six months in the forecast of monthly seasonally adjusted annualized rate (SAAR) volumes," said Walter McManus, executive director of global forecasting at J.D. Power and Associates. "Incorporating vehicle transaction data directly from dealers, these highly accurate monthly forecasts allow us to provide our clients with market changes as they occur."

The firm's monthly sales forecasts are derived from a joint effort between its Global Forecasting Department and Power Information Network (PIN), a division of J.D. Power and Associates that compiles new-vehicle retail transaction data from more than 5,900 participating auto franchises in 26 U.S. markets.