According to Steven Szakaly, chief economist of the National Automobile Dealers Association (NADA), U.S. sales of new cars and light trucks will set an all-time record in 2016. NADA predicts sales of 17.7 million new light vehicles, which would represent a 2% increase from 2015, and a seventh consecutive year of auto sales growth.
Auto sales are expected to continue to rise as manufacturers, battling for market share, start increasing incentives. The concern is whether the record-breaking sales will begin to cannibalize future sales. The optimistic prediction (and sustained sales momentum) in 2016 are dependent on expectations that auto financing rates will remain competitive; wages will grow about 2.5% this year; and the economy will add more than 2 million net new jobs in 2016.
Automakers Overcome Storm to Post Best January Sales in a Decade
Automakers reported the strongest U.S. January sales in a decade, topping analysts’ estimates and showing that even three feet of snow couldn’t stop consumers from buying cars. The industry’s Seasonally Adjusted Annual Sales Rate (SAAR) was 17.6 million, the highest January since 2006, according to researcher Autodata Corp.