New car sales are looking strong in good sign for economy
An assessment of November sales prepared by J.D. Power and Associates' Power Information Network and Troy-based LMC Automotive indicates that sales are recovering from the impact of Hurricane Sandy, which had closed dealerships up and down the East Coast. November is expected to reflect the highest retail selling rate since January 2008, which was before the financial crisis triggered a plunge in car sales and pushed the American auto industry to the brink of bankruptcy.
"Sales have strengthened each week in November, which bodes well for a strong finish to the month and the year," said John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates.
"We expect healthy sales in December, as the industry continues to recover from Sandy and leads into its year-end sales events." Total light-vehicle sales in November are expected to increase 12 percent from November 2011 while fleet sales are expected to hold steady below a 17 percent share of total sales, which is the same level as October but lower than the 18 percent share last November.
LMC Automotive is maintaining the 2012 forecast for total light-vehicle sales in the United States at 14.4 million units and the forecast for retail sales at 11.7 million units. While the forecast still rounds to the same numbers as it did in October, the overall outlook is more favorable. The U.S. sales forecast for 2013 remains stable at 15 million units for total light-vehicles and 12.2 million for retail sales, but represent a slower growth rate of 4 percent from 2012.
In addition, LMC senior vice president Jeff Schuster said there continues to be the possibility of accelerating the growth in 2013, as the current level of uncertainty is expected to decrease in the first half of the year.
"The irrepressible need and willingness of consumers to replace aging vehicles is stronger than the effects of natural disasters and fiscal turmoil both here and abroad," Schuster said.
"A sustained recovery pace in auto sales is expected over the next six months, barring any fiscal cliff hangover, but the medium-term forecast is still dependent on more pronounced economic activity and growth."
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