Since the 1940’s, the automotive car industry has seen unpresented growth throughout the decades. Even in times of uncertainty, car manufacturers have still remained buoyant as they have reacted to the world’s markets. It is no secret that the world is facing one economic crisis after another. For most of us, the first thing that we will cut back on is the luxury items that we own.
We shall now take a look at some of the reasons why worldwide car sales have slowed down and look at if this is the time to bag a bargain.
Car production is usually fully automated and large manufacturers can churn out hundreds of cars a day, enabling the market to be saturated with new vehicles. Although this is not a reason why car industry sales have slowed, manufactures have realised that they are now holding masses of surplus stock and this is driving down the purchases of new cars. There is also an economic crisis looming which means that the money that was available to purchase new cars is now not as readily available as it once was. This means that people are now holding on to their cars for longer.
Above we mentioned, the looming economic crisis will automatically put a strain on the world’s banks and the way in which they lend money. As banks regulate more than ever before, the number of loans that they approve will decrease, again slowing down the purchases of new vehicles.
Cars Lasting Longer
These days modern cars do not get to the scrapyard as quick as they used to. Cars worth under $10,000 are in high demand. So, this section of the market hasn’t seen much change. when searching terms such as ‘best used cars under $10,000’, you will soon notice that you are inundated with options. As the quality of used cars has never been better, there are two things that are now happening:
- We are keeping cars longer as there is no need to replace them.
- There are a great number of used cars that can be traded.
We are all tempted by cheap used cars for sale, and the temptation is to spend as little as possible but get the best deal as possible. However, in an era where we are environmentally conscious this isn’t always possible. One of the main issues faced by the current car market is that we are now looking for environmentally friendly cars that are either low emissions or zero emissions. As the technology has improved, these cars are now available but they are still relatively very expensive to by when compared to the standard combustion variants.
Secondly, as the technology is fairly new, we don’t have any long-tailed data to tell us how these cars will perform over a number of years. It’s also a point to note that although we are making quick and strong advances in electric vehicles, the number of outlets available where these can be charged is still relatively low. The number of trained mechanics qualified to be able to deal with these vehicles is also relatively low. This means that consumer confidence is still in its infancy and this will have a knock-on effect to people purchasing these cars.
Governments have been regulating against pollution and they are now seriously taking steps in us all reducing our carbon footprint and CO2 emissions. As those restrictions are getting tighter, the worlds’ car markets are having to react quickly so that the vehicles that they are supplying meet the targets set to reduce the emissions issue.
Manufacturers in Crisis
Knocking consumer confidence is one sure fire way of reducing your product growth. Over the past few years, there have been a number of scandals involving some of the world’s most famous car manufacturers which have rocked the car industry. We all buy into brands and the better the brand, the more confidence you think you have in the products that you are buying. When the major emissions scandal hit one of the leading German car manufacturers, this sent shockwaves around the world which really damaged consumer confidence. It made us all look to our vehicles to see if this was an isolated case or whether the rest of the car manufacturers were doing a similar thing and hiding it from the consumer. This kind of scandal does not help car sales and could be regarded as a contributory factor to the reduction in car sales.
Public transport has always been the bane of the car manufacturing industry. Although this comment is tongue in cheek, car manufacturers want their consumers to purchase their vehicles. With the growing popularity of public transport and the improvements that have been made to public transport across the world, public transport is now becoming a serious contender in taking care of our transportation needs. Above we have mentioned environmentally friendly car technology for reducing emissions, however the advances in autonomous vehicles is just around the corner. Large cities across the world are now starting to introduce driverless vehicles which are becoming an integral part of our everyday world.
There is no one reason why car sales are slowing down across the world, there are a multitude of reasons and where you live in the world may have an impact on the reasons for the reduction in car sales. Looking at local press and the news, you will be able to determine the reasons as to why your particular country may be having a slowing growth in the car industry.