Making Sense Of The Auto Industry In 2015

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I can’t be the only one seeing the incongruities in the American auto industry in 2015. Yet, I think if more people stopped to consider it, they’d not only see the incongruities, but they’d be puzzled, too.

In the first six months, Ford has sold 1,288,319 units and GM has sold 1,505,545. Those are impressive numbers, although fewer units that 2005 which was a record sales year for the industry.

Making Sense Of The Auto Industry In 2015

Ford Motor Company

Making Sense Of The Auto Industry In 2015

General Motors

Notice I didn’t include Chrysler sales figures in the discussion. That’s because Chrysler is not an American-owned car manufacturer. Fiat owns it. And Fiat disparagingly stands for “Fix It Again, Tony!” How long will it be before Chrysler’s quality figures follow those of its parent? It may already be happening. According to Consumer Reports, “Chrysler, Dodge, Jeep, and Fiat brands all scored near or at the bottom.”

At the same time, there has been nearly 100 million auto recalls: 74.2 million in 2014 and 25 million in 2015—a record.

Surely, this startling statistic has negatively impacted overall quality ratings at GM and Ford. According to J.D. Power & Associates ratings, however, GM and Ford car ratings are better than most.

Making Sense Of The Auto Industry In 2015

Takata Airbag Deploys.

Some could argue the record number of recalls is attributable to the Takata airbag recall—the single largest auto recall ever. Taking that into account, then why do J.D. Power ratings remain high? Is it because airbags are not considered essential to the car’s quality rating? An airbag is part of a car’s safety system, though, similar to the brakes. If the quality of the brakes matters to overall quality ratings, why doesn’t the quality of the airbag? Or, is it because certain auto industry members view airbags as an unnecessary mandate on personal freedom? Don’t even get me started on that.

Pent Up Demand Trumps Recalls

So, why doesn’t the record number of recalls negatively impact car sales? Because new car purchases postponed because of the Great Recession are finally happening. Record recalls? We don’t need no stinkin’ recalls, to paraphrase Treasure of the Sierra Madre (my apologies to Humphrey Bogart).

So, are American car buyers so hell-bent on buying new cars they disregard the record number of recalls? Or, are they so weary of the never-ending parade of recall notices they no longer pay attention? Whatever the underlying reason, car buyers are out buying. The auto industry may be relieved after the Great Recession beat them down, but it’s puzzlement for observers of human behavior.

What do you think? Write me at bill@horespowerbroadcasting.com.

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About Author

Bill is an Associate Producer at Horsepower Broadcasting as well as our Operations Analyst. He personally oversees most all of the myriad interviews with our automotive celebrity guests. He handles scheduling, contacts, press releases, press passes and everything in between. His keen intellect is awe inspiring and he is a true academician in every sense of the term.

Many of our business related blogs and posts are created and written by him as the business category is what Bill is most familiar with. He has a wide range of interests in business related subjects including marketing, sales, finance, motivation, leadership, banking, technology and leading edge thinking.

His input and contributions to the show are invaluable and we are grateful he is a part of our team.

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