Day two of the 2013 convention kicked off with NADA leaders optimistic of the rising economic state of the automotive industry.
“Old cars on the nation’s roads and available credit assure a good year for car sales as the economy continues to make modest but positive progress in overall growth,” said Paul Taylor, chief economist of NADA. Taylor predicted that more than 15.4 million new vehicles will be purchased or leased in 2013, an increase of a million vehicles.
Due to availability of credit, those with average and above-average credit aren’t the only ones helping bolster the market.
“It’s not just people with perfect credit, but people with credit with a few bumps in the road,” said Taylor. “The financing mechanism is starting to work in a very positive way for car sales.”
Many believe the momentum from this weekend will be sustained throughout the market in the coming year and into the near future, with improvement in unemployment and the housing market being key drivers. Specifically, Taylor cited markets on the west coast, southeast, and northeast being major influencers in nation’s overall positive trend.
While the new-car market remains top of mind with most dealers, the used-car outlook is equally optimistic.
“We think used prices will remain strong in 2013 because we’re in a sustainable automotive recovery, said Jonathan Banks, NADA Executive Automotive Analyst. “Production is aligned with demand.”
Though used-car prices have stayed high, Banks argued that market averages are still significantly below historical norms, offering room for growth. Moreover, reduced unemployment in the manufacturing and retail sectors has strengthened sales.
The trend of new-car optimism continued in the opening general session. NADA Chairman, Bill Underriner, stressed the importance of the dealer community as the lifeblood to the economic recovery. Both Underriner and keynote speaker, John Krafcik, CEO of Hyundai of America, emphasized the value of the dealership franchise model as an important reason for economic impact on both a local and national level. Krafcik closed the session by showcasing the new innovations of Hyundai, promoting a dealership-OEM model that focuses on growth through adaptation and innovative customer service.
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