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Declining Domestic Vehicle Sales Could Spell Trouble for Auto Repair Shops

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Declining Domestic Vehicle Sales Spells Trouble for Auto Repair Shops

July 26, 2017—Through the first six months of 2017, car and light truck sales fell approximately 2 percent versus the same period last year. But, as Lang Marketing points about, domestic nameplates suffered virtually all of that decline.

"While most commentators have focused on the modest year-to-date 2017 sales decline, significant changes are occurring in the mix of vehicles sold in 2017, which will have important implications for future aftermarket volume," writes Jim Lang, president of Lang Marketing.

This is no surprise to Lang, who reported in June that foreign nameplates have expanded their light vehicle product share, recording an $11 billion surge in product volume in the auto service market between 2011 and 2016.

When Ratchet+Wrench spoke with Lang earlier this year, he pointed out how this could potentially be a problem for automotive repair shops, as people who buy foreign vehicles are historically more likely to visit the dealership for service—which is especially concerning with foreign nameplates accounting for approximately 52 percent of all cars and light trucks six to 10 years old in the U.S. at mid-year 2017.

Although June marks the sixth straight month of lower sales during 2017, annual new car and light truck volume could still top 17 million, if the rate of sales decline does not worsen over the balance of the year. 

Domestic nameplates recorded a 4 percent reduction in 2017 year-to-date sales through June, while foreign nameplate car and light truck volume was down less than 1 percent. As a result, domestic cars and light trucks accounted for over 85 percent of the 200,000 reduction in light vehicle volume during the first six months of 2017.

Foreign nameplate cars and light trucks reached a record-high 55.3 percent of year-to-date sales through June 2017, considerably stronger than their 54.5 percent share for the same period last year.

Photo courtesy of BMW.

 

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