Last year, the number of vehicles on U.S. roads rose by about 1.3 million units due to new car sales of 15.3 million units outpacing 14 million junked vehicles. This year, analysts are predicting the number of new vehicle registrations to hover around the 10 million mark, which means if another 14 million cars are junked there will be roughly four million less vehicles on the roads. The last time there was a decline was in 1945, the end of World War II.
Speaking with CNNMoney, General Motors' head of sales analysis, Mike DiGiovanni, said the news may not be all bad for the American auto industry, as it will create a "pressure point that will lift the industry" as older cars on the road eventually need to be replaced. However, this theory doesn't quite have a universal consensus, with other experts claiming that car sales will continue to decline or remain steady as unemployment keeps rising and people make do with fewer cars.
Likening the auto industry to the housing industry, CSM auto consultant Joe Barker said the bubble has truly burst for the auto industry and that sales figures of around 10 million cars a year are to be expected in the coming years due to lower demand and structural changes.