2016 was an amazing year for auto sales growth bit it’s still to early to know whether any major records were broken or not. What we do know is that in 2017 the industry is expected to experience a decline in growth with a drop in sales of about 200,000 vehicles.
The drop will mainly consist of low to mid-end vehicles as those with a lower income are beginning to struggle against the rising cost of expenses. Those with cash to spare are expected to continue buying up to-end luxury vehicles.
Auto sales have had phenomenal growth over the last few years and this growth couldn’t keep up forever. Instead rising gas prices and increased interest rates will put pressure on lower income households. This in turn will reduce spending on vehicles.
With the arrival of Donald Trump later this month we need to wait and see what the outcome will be. It certainly looks like he’ll be draining the swamp in the White House and along with this removing many needless and petty regulations. If he brings in those promised tax cuts than the auto industry may be bolstered by the extra funds.
December sales of auto vehicles has reached 17.6 million cars and light trucks, up 100,000 from last year’s 17.5 million. There was also one less sales day this December compared to last year’s December.
It’s still too early for any definite forecasts from automakers as they will be releasing their forecasts around the time of the Detroit International Auto Show which runs from the 8th to the 22nd of January.
Consumer confidence has begun to climb since Donald Trump was elected and has reached the highest rating since 2001. This combined with tax cuts and a new fiscal stimulus could see auto sales hold steady for 2017 rather than falling.
Filed under: News
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