According to the National Automobile Dealers Association, there will be reason for its members to celebrate by the time December 31, 2013 rolls around. That’s because it is expecting a 1M increase in units sold or leased over 2012 levels.
The total sold or leased for 2012 was 14.4M – and NADA’s chief economist Paul Taylor is expecting to reach 15.4M this year. That would be a 6.5% increase in sales.
Here, from NADA, are the factors underpinning Taylor’s optimistic views:
* Pent-Up Demand – The continued replacement of cars and trucks that aged to a record level during the recession will propel sales this year.
* Available Credit – Low interest rates for auto loans, which are expected to increase in future years, will help motivate consumers to finance a new vehicle purchase in 2013.
* More New-Vehicle Choices – New-vehicle models with greater consumer appeal in design and fuel efficiency are headed to dealerships. About 50 new models will be introduced at the North American International Auto Show in Detroit.
* Declining Unemployment – The falling rate of unemployment has led to improving consumer confidence.
* Used-Vehicle Shortage – The continued short supply of used vehicles for sale resulting from the past recession will cause some consumers to purchase new vehicles this year, instead of used ones.
* Fiscal Cliff Avoided – So far, modest action by Congress to avoid the fiscal cliff, which avoids some tax hikes, will result in more new-vehicle sales early in the year.
* Improving Home Values – Residential real estate prices are showing a recovery in nearly all states in the nation, increasing the typical family nest egg. As a result, consumers are more confident about spending on big-ticket items.
RBR-TVBR observation: This is the kind of thing that could have a positive ripple effect throughout the economy – and of course, it will have a direct positive effect on advertising sales. Go get ‘em, car dealers!