More Bad News Imminent: August US Auto Production Set To Plunge By Most In 16 Months

Tyler Durden's picture




 

Over the past several months, many pundits were scratching their heads at the peculiar patterns in summer hiring and layoff trends, which threw all NFP, claims, and JOLTs forecasts in a loop making a mockery of even the best forecasters. The reality is that there was a very specific reason for this abnormal seasonal pattern: numerous car plants worked throughout the summer, avoiding traditional temporary shutdowns and furloughs, in an attempt to provide an optical boost to the Union-endorsed administration. And as always happens (see Cash for Clunkers), every attempt to pull demand or supply from the future to the present results in an eventual collapse in either of these two. Sure enough, with June and July reaping the benefits of advance demand, August is set be an absolutely abysmal month for US auto assemblies and for Industrial Production. Because as Stone McCarthy calculates, based on projections provided by Wards Autos, the U.S. motor vehicle assembly rate for August is projected to decline by 8% to a 10.1 million annualized rate after rising by 4.4% in July. This would be the biggest monthly percentage decline in the assembly rate in about a year and a half, since April 2011's 9.5% drop.

SMRA continues:

For the Fed's industrial production report, we project motor vehicle output to decline by 4% in August after rising by 3.3% in July. The anticipated decline in motor vehicle output will restrain industrial activity in August. In July, industrial output rose by 0.6% with manufacturing output up 0.5%.

And since Industrial Production feeds directly into bean counter models for GDP calculations 2%+ GDP forecasts for Q2 are about to see their floor falling off and the economy return to a sub-stall speed growth rate, even as the growth rate of debt refuses to budge lower by even one iota.

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Thu, 08/30/2012 - 11:13 | 2749546 SilverTree
SilverTree's picture

<-----QE this year.

<-----QE next year.

Thu, 08/30/2012 - 11:23 | 2749585 Vincent Vega
Vincent Vega's picture

<---------QE for ever and ever.

Thu, 08/30/2012 - 11:33 | 2749617 GetZeeGold
GetZeeGold's picture

 

 

Crap.....what's going happen if I need to buy a Volt?

 

Thu, 08/30/2012 - 11:36 | 2749628 Vincent Vega
Vincent Vega's picture

Probably pick one up at a fire sale.

Thu, 08/30/2012 - 11:45 | 2749651 NotApplicable
NotApplicable's picture

I'm sure this is merely a seasonal anomaly.

How long was the Dark Ages again?

Thu, 08/30/2012 - 12:03 | 2749718 Manthong
Manthong's picture

One man’s optical boost is another man’s boiling mirage.

Thu, 08/30/2012 - 11:49 | 2749666 SafelyGraze
SafelyGraze's picture

"Probably pick one up at a fire sale."

that was funny

Thu, 08/30/2012 - 11:57 | 2749694 ptoemmes
ptoemmes's picture

There are two kinds of Volts: ones that have caught on fire and ones that are going to catch on fire.

Thu, 08/30/2012 - 11:58 | 2749702 Turin Turambar
Turin Turambar's picture

and if it's actually on fire when you buy it, it'll be even cheaper.

Thu, 08/30/2012 - 11:40 | 2749634 DoChenRollingBearing
DoChenRollingBearing's picture

Buy a Hyundai!  ;)

Hyundai actually makes a nice looking Sonata Hybrid.

Yes, sir!  We have your bearing!  Down in Peru...

Thu, 08/30/2012 - 11:37 | 2749630 slaughterer
slaughterer's picture

I am going back to painting my nude studio model until 10am tomorrow.  Seeing Liesman on CNBC just demoralized me.  

Thu, 08/30/2012 - 12:04 | 2749714 poor fella
poor fella's picture

Put Liesman's head on your nude and you'll have a museum worthy piece.

I'm sure there's a critic that will write up four or five paragraphs how monumental your symbolic critique of civilization and characteristic frisson between the civilized work force and the awareness of subconscious forces beneath the surface within us all.

or something like that ;)

better yet, slap on a $950k price tag and they'll be beating your door down.

Thu, 08/30/2012 - 11:25 | 2749591 CrashisOptimistic
CrashisOptimistic's picture

Bernanke is actually a smart fellow.  He's an academic and looks at data.

Suppose he said, the point of printing money is to be sure that a growing economy is not choked off by its lack.  Since we're not growing very fast, we don't need to add any more.  Further, 10 year bond yields are low and falling again, so there's really no point.

Perhaps no more QE as far as the eye can see.

Thu, 08/30/2012 - 11:30 | 2749608 SheepDog-One
SheepDog-One's picture

LOL, people still actually think the Fed are mechanics busilly turning wrenches trying to fix things? 

Thu, 08/30/2012 - 11:54 | 2749684 Miss Expectations
Miss Expectations's picture

I think that the Fed mechanics just keep spraying ether into the economy's carburetor...does our economy still have a carburetor?

Thu, 08/30/2012 - 12:33 | 2749818 boiltherich
boiltherich's picture

does our economy still have a carburetor?

Do we still have an economy?

Thu, 08/30/2012 - 11:30 | 2749610 SilverTree
SilverTree's picture

Most agree they never stopped QE-ing. 

Overt/Covert.

Thu, 08/30/2012 - 13:16 | 2749966 Poetic injustice
Poetic injustice's picture

"Since we're not growing very fast,"

 

Are you ASSuming based on official data, like "academics" do?

Thu, 08/30/2012 - 11:58 | 2749697 TrillionDollarBoner
TrillionDollarBoner's picture

those QE scores would have been reversed a few months ago. looks like kito and sheepie1 have called this right for a while

 

still room to be wrong though... (december)

Thu, 08/30/2012 - 11:14 | 2749552 Seasmoke
Seasmoke's picture

you can pay me now or you pay me later.....but you will pay !

Thu, 08/30/2012 - 12:38 | 2749842 socalbeach
socalbeach's picture

Gives new meaning to the term "money laundering".

Thu, 08/30/2012 - 12:41 | 2749850 monad
monad's picture

It was a fiat dime.

Thu, 08/30/2012 - 13:19 | 2749977 GeezerGeek
GeezerGeek's picture

Back in '63 dimes still contained silver.

Thu, 08/30/2012 - 13:18 | 2749971 glenlloyd
glenlloyd's picture

Yes....several of those sorts of quack 'dismissals' going on here in Iowa with WF. They've suggested that it was new FDIC rules that brought this all about, something about taking care that there aren't any more Bernie Madoff's around.

What a load of BS

Thu, 08/30/2012 - 11:14 | 2749554 Jason T
Jason T's picture

garbage index..  down 26% year over year

 

http://daytradersfx.com/the-us-garbage-indicator/

Thu, 08/30/2012 - 11:18 | 2749567 Long-John-Silver
Long-John-Silver's picture

EPA now stands for Employment Prevention Agency. What better way to reduce pollution than to prevent production of everything.

Thu, 08/30/2012 - 12:15 | 2749759 i-dog
i-dog's picture

'Agenda 21', biachez! Like it or lump it.

Thu, 08/30/2012 - 11:14 | 2749556 bnbdnb
bnbdnb's picture

ECRI - timing was exact. Recession started in Q2, May 2012.

Thu, 08/30/2012 - 11:15 | 2749559 Long-John-Silver
Long-John-Silver's picture

QE Tomorrow, Bitchez!

Thu, 08/30/2012 - 11:33 | 2749620 Alpacanio
Alpacanio's picture

Lol. don't you guys get it. QE has never stopped! Look at the National Debt clock!

Thu, 08/30/2012 - 11:15 | 2749560 mrktwtch2
mrktwtch2's picture

no more channel stuffing..

Thu, 08/30/2012 - 11:16 | 2749561 chunkylover42
chunkylover42's picture

<---  QE never

<---  QE forevah!

Thu, 08/30/2012 - 11:36 | 2749605 JustObserving
JustObserving's picture

With US debt and unfunded liabilties currently increasing at $8.35 trillion a year ($22.86 billion a day), we will have QE forever.  

The longer that Bernanke goes without QE, the larger the next QE will be.

Thu, 08/30/2012 - 12:48 | 2749875 JimBowie1958
JimBowie1958's picture

More QE till we finaly hit the brick wall of inevitable consequences.

Thu, 08/30/2012 - 11:17 | 2749562 the 300000000th...
the 300000000th percent's picture

Why in the hell are they letting these facts leak out like this, very suspicious!

Thu, 08/30/2012 - 11:22 | 2749580 Meesohaawnee
Meesohaawnee's picture

when you want to figure out a criminal you gotta think like one. Nothing wrong with being suspicious.....

Thu, 08/30/2012 - 12:43 | 2749858 monad
monad's picture

Deep rooted sadism

Thu, 08/30/2012 - 11:17 | 2749563 icanhasbailout
icanhasbailout's picture

bullish

Thu, 08/30/2012 - 11:37 | 2749631 buzzsaw99
buzzsaw99's picture

I noticed a horse running the other day at RP. The name was I Need A Baleout. Racehorse names are a leading indicator.

 

Running tomorrow:

Deflationary Fears

Pretend and Extend

 

Thu, 08/30/2012 - 22:08 | 2751335 StychoKiller
StychoKiller's picture

"Grand Apocalypse" is in the running... :>D

Thu, 08/30/2012 - 11:20 | 2749573 ParkAveFlasher
ParkAveFlasher's picture

Yes, sales are down, production is down, but I'd like to put a few cars away for my grandchildren.  Any chance at financing?

Thu, 08/30/2012 - 11:20 | 2749574 Hype Alert
Hype Alert's picture

Stealth campaign contributions by the union was documented in the WSJ a month or so ago.  The union spends millions in political efforts that are not reported as contributions.  When government gets directly involved in the economy, read Government Motors, it becomes more corrupt than throwing games because of gambling bets.

Thu, 08/30/2012 - 11:21 | 2749575 OldE_Ant
OldE_Ant's picture

(/sarc) Yeah but arn't bicycles and motorcycle sales at all time highs? 

If they don't have a job, they don't need a car!

I feel a government auto purchase rebate program coming soon.  Maybe they should switch over to manufactoring Armored personnel assault vehicles.  I hear those are selling like hotcakes, or better retool for gun barrels, or ammo.(/sarc)

End of Line

Thu, 08/30/2012 - 11:21 | 2749576 Dr. Engali
Dr. Engali's picture

I thought Obama saved the U.S automotive industry. Maybe he can by us all a new car out of his stash.

Thu, 08/30/2012 - 11:41 | 2749638 NotApplicable
NotApplicable's picture

Help the plebs? Doubt that.

At least not until you see every government worker driving a new GM car first.

They should give them away with scratch-off tickets. The plebs fucking love scratch-off tickets! (thank God for pay-at-the-pump)

Thu, 08/30/2012 - 11:21 | 2749577 Meesohaawnee
Meesohaawnee's picture

bullish

Thu, 08/30/2012 - 11:21 | 2749578 youngman
youngman's picture

We need more student loans so we can buy more cars...but it must of been the Volts...all those GM Volts

Thu, 08/30/2012 - 11:23 | 2749584 LawsofPhysics
LawsofPhysics's picture

Better get the rest of that bailout money back, and fucking quick.

Thu, 08/30/2012 - 11:24 | 2749586 Curt W
Curt W's picture

I take it that all the channels are adequately stuffed.

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