Auto Sales End a 7-Year Upswing, With More Challenges Ahead

Auto Sales End a 7-Year Upswing, With More Challenges Ahead


Chrysler Pacifica minivans at a dealership in Jackson, Mich., where incentives were being offered last spring to reduce manufacturers’ inventory.

Brittany Greeson for The New York Times

The auto industry’s long-running sales party has come to an end.

After seven straight years of growth in new-vehicle sales in the United States, manufacturers on Wednesday reported a decline in 2017, by about 1.8 percent to 17.2 million cars and light trucks.

Further dampening the mood is the consensus that 2018 will bring an even larger drop., an auto-information website, predicts that just 16.8 million light vehicles will be sold this year.

“Over all, you have to be cautious in this environment,” said Adam Silverleib, vice president of Silko Honda, a dealership in Raynham, Mass. “The industry cycle has peaked.”

Some factors that propelled the upward swing are now fading or changing course. Exceptionally low interest rates are turning higher. Fuel prices are rising again, at $2.49 a gallon for regular gas compared with $2.35 a year ago, according to AAA.

Slowdown Last Year

Domestic sales of light vehicles declined in 2017 for the first time since the financial crisis to 17.2 million from 17.6 million in 2016.

The downward sales trend is the latest challenge for the industry. Tariffs could be imposed on cars made in Mexico and Canada if the Trump administration negotiates major changes to the North American Free Trade Agreement. Manufacturers are also trying to push ahead with self-driving and electric vehicles even as it remains unclear how many they will be able to sell, and when.

The seven-year stretch of growth from 2010 to 2016 is the longest streak of rising sales since the infancy of the automobile nearly a century ago, according to the automotive publisher WardsAuto. It was born out of one of the industry’s darkest periods: the deep recession that prompted federally backed bankruptcy reorganizations of General Motors and Chrysler. At the low point, in 2009, new-car sales plunged to fewer than 11 million a year.

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