The increase in the sale of new cars during the month of August was through the roof percentage-wise, and while it wasn’t quite so dramatic in September, there is a reason. There’s no reason to complain about the number behind the plus sign.
Kelley Blue Book says the seasonally adjusted annual rate for September will be 14.3, down a bit from the 14.5 SAAR posted in August. The biggest difference between the two months, however, was in year-over-year comp – in August, it was +20%; in September, only +8%.
However, there is a logical explanation.
“This time last year Toyota and Honda were able to boost production and sales after several months of downtime following the earthquake and tsunami in Japan,” said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. “Now that year-over-year figures are more comparable, annual gains will level out and remain between 7 to 10 percent through year-end.”
Automobile purchase are among the big ticket items that consumers have been holding off on buying, and finally, more and more are getting into the market.
“The average vehicle on the road today is approximately 11 years old. Those consumers that have delayed their purchase of a new vehicle during the past several years due to economic reasons are finally making the decision to trade-up to something new,” said Gutierrez. “As a vehicle ages beyond 10 years old, or has more than 100,000 miles on the odometer, rising maintenance costs and deteriorating reliability can become a serious headache. Drivers of older vehicles are keenly aware of this fact and many are opting to take advantage of the near zero percent finance offers on today’s more reliable and fuel-efficient vehicles to achieve peace of mind.”
RBR-TVBR observation: Demand is on the rise, and it looks like that is a pattern that can be counted on for the next several months at the very least. All of your clients will want to get their message out there to get their fair share of business..