Wednesday, January 19, 2011

Sales, Optimism Picking Up in U.S. Auto Industry

The U.S. auto industry, experiencing a sales increase of 11 percent nationally through November, is clearly in recovery.
Much of the gain is from "need;" buyers who are replacing aging high-mileage autos. But over the last quarter of 2010,  dealers say they also have seen "want" buyers return; consumers with late-model vehicles trading them on new cars and trucks because they are attracted to the styling or interiors or more powerful engines.
"There are a number of good factors boosting sales," said Rasheed Davis, a sales manager at Hennessy Mazda in Jonesboro. "But when impulse buyers are coming back in, we know that sales will really strengthen."
Despite an uncertain economy, persistently high jobless figures and rising fuel prices, the auto industry shows optimism when it comes to the economy in general and the business in particular.
"We like what we see when we look toward the near-term future," Davis said.
The return of impulse buyers is only one driver in the sales increases.
The average vehicle in the U.S. is now 9.4 years old, compared with seven years in 2001, according to auto industry statistics. 
That will send many people to dealerships.
They will find lots of shiny candidates in showrooms these days - maybe the best array of new products in industry history.
Vehicles such as the new Chevrolet Equinox, Buick Regal, Ford Fiesta, Dodge DurangoJeep Grand Cherokee , Subaru Outback and Hyundai Sonata are just a few of the strong draws.
Also, used-car prices have gotten so high that the price gap between late-model used vehicles and new ones is becoming negligible, especially with the lower interest rates available on new-car loans.
"We do see real evidence that the pace of new-car sales is picking up," said Paul Taylor, chief economist of the National Automobile Dealers Association, said in a news report.

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