Strong North American Auto Sales Continue
September 12, 2014
The North American economy continues to bounce back from the last major recession and nowhere is that more evident than at new car dealerships.
Sales of new cars and trucks across Canada increased eight per cent in August compared to the same month last year. That was an all-time for the month, with eight automakers reporting double-digit, year-over-year growth. Sales in the United States also soared to levels not seen since 2006.
In B.C., new car sales were up 14 per cent in July, the latest data we have available, compared to the same month last year, and up five per cent between January and July, compared to the same time period in 2013, according to DesRosiers Automotive Consultants.
Low interest rates are helping spur auto purchases, alongside improving economic fundamentals that are boosting consumer confidence. New makes and models, improved technologies and greater fuel efficiency are also luring more people to new car lots.
““We’re in product nirvana,” Dennis DesRosiers, president of DesRosiers Automotive Consultants, told the Financial Post recently.
He said the industry has introduced more than 70 new products this year, each one better than the last. Examples of new models include BMW’s 4-series coupe, the new Cadillac CTS, the restyled Ford Camaro, the redesigned Chevrolet Impala and the Kia Cadenza, to name a few.
There are also some great incentives being offered by most vehicle manufacturers, including low or even zero-per-cent purchase financing.
This combination of these incentives and improving economic conditions has been steadily fuelling car and truck sales since the 2008-09 recession.
Canadian auto sales reached a record 1.74 million vehicles in 2013, up four per cent from 1.67 million in 2012, and surpassing the previous record of just over 1.7 million in 2002. That compares to sales of 1.46 million in 2009.
Sales in 2014 and are on track to break another annual record, according to Scotiabank economist Carlos Gomes. In a recent report, he forecasted sales to reach 1.77 million this year.
Gomes also see U.S. light vehicles sales increasing to 16.3 million this year, up from 15.5 million in 2013. North American production is set to grow to 17.1 million, up from 16.49 in 2013.
While auto sales are cyclical, National Automobile Dealers Association chief economist Steven Szakaly said in a recent industry newsletter that he believes the economy still has room to grow. He forecasts auto sales will remain strong in the U.S. least for the next year and a half, which means Canada is also likely to see growth as well.
Consumers looking for a new car or truck have more options to choose from than ever before. Manufacturers are also using technology and ongoing customer feedback to continuously build the best vehicles on the market.
Now all you have to do is choose the right one for you.
Blair Qualey is President and CEO of the New Car Dealers Association of BC. You can email him at email@example.com.
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