Phone: 630-495-2282 Fax: 630-495-2260 Map/Directions

NADA: 3 factors will lead to 13.9 million new-vehicle sales in 2012

January 6, 2012
As the U.S. economy continues to improve this year, the National Automobile Dealers Association’s chief economist predicts more than 13.9 million new cars and light trucks will be purchased or leased in 2012.
Paul Taylor, who is forecasting sales of 13.945 million new cars and light trucks for 2012 in the U.S., cites three key factors for the increase:
(1) Aging vehicles,
(2) Affordable credit, and
(3) Aggressive incentives
A key factor that will drive new-vehicle sales in 2012, said Taylor, is pent-up demand in the marketplace caused by more consumers shopping out of necessity to replace their aging vehicles.
“With the age of cars and trucks on the road today at nearly 11 years, consumers can no longer delay purchasing a new or newer vehicle,” he said.
An increased availability of affordable credit from competing lending sources for auto loans is another factor that is likely to result in higher auto sales this year.
“Interest rates on new-car loans will remain historically low in 2012 due in part to policy decisions by the Federal Reserve Board to keep rates low and the U.S. economy growing,” Taylor said. “As a result, affordable credit will be widely available in 2012, with more automaker finance companies offering low-interest and interest-free loans for up to 60 months.”
Taylor said both domestic and international automakers will wage an aggressive battle to capture U.S. market share in 2012 by rebuilding a diverse selection of vehicle inventory at dealerships, ranging from cars and CUVs to truck-based SUVs.
A decline in gasoline prices, he added, also will lead to car buyers considering a wider range of vehicles in different segments.
“Auto sales typically increase with the exposure given to new vehicles during the auto show season in the first quarter and beyond,” Taylor said.
“Lower vehicle costs for car buyers through manufacturer incentives and rebates, combined with low interest rates, will support stronger sales in 2012. And higher prices on used vehicles means higher trade-in prices when shopping for a new car or truck.”