US car market set for difficult 2005 17th December 2004

Heavyweight automotive manufacturers say they are not anticipating a strong 2005 in the US, according to the latest analysis.

Deutsche Bank's new appraisal of the industry has offered a revised impression of the US market, scaling its predictions for next year down.

Highlighting the performance of General Motors and Ford in particular, economists revised their 2005 sales estimate down by 400,000 to 16.6 million.

That figure would represent a small dip on the total sales for 2004, and the leading American automotive firms agree that the market conditions remain difficult.

George Pipas, Ford's US sales analysis manager, told the Detroit News that his firm had also recognised that next year was likely to follow a similar pattern of limited growth.

"We're looking for a sales year in the range of 17 million units, but that's total sales, including heavy and medium trucks," he said.

"The economy has expanded more than four per cent this year, but auto sales have been fairly stable," Mr Pipas added.

"Historically, that kind of growth would have resulted in an eight to nine percent increase in sales, but they have been flat."

Analysts say the intensive use of incentives in previous years has created a dip in demand more recently, although the upward path of the US economy has heartened some.


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