While sales across the US have been the best since before the last great recession of 2008-2009, the automakers feel the pressure, as the industry has become highly competitive and incentive driven.

In their attempt to survive the new scenery, automakers now resort to faster product changes – which allows them to introduce new technologies and keep initial prices up for an extended period of time.

On average, in the last 20 years, the US carmakers had 38 new models out each year, but in the next four years the statistics will surge towards 48, says John Murphy, senior auto analyst for Bank of America Merrill Lynch Global Research.

“The model-intro activity is picking up pretty aggressively as we go through the next four years,” says Murphy. “The companies have had enough time to recover from the trough in sales in 2009, ramp up the product investment and pull some stuff forward a little bit, and what we’re going to see in the next four years is some great new products. And obviously new products should help bring consumers into the showroom to drive sales higher.”

The ongoing faster product cycle trend is driven by the automakers’ thirst for additional market share gains, the desire to profit from the rising demand for models in the SUV/crossover segment and the need to swiftly meet new and stricter federal regulations on fuel efficiency and pollution.


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