San Francisco – — The chief economist for the National Automobile Dealers Association said Friday that low gas prices and demand for trucks and crossovers will lead to the sale of 16.9 million vehicles in the United States this year. That would be an increase from the 16.5 million sold in 2014.
Steven Szakaly, NADA’s chief economist, said an improving housing market, low gas prices and increased job growth are leading to a surge in demand for SUVs and trucks.
“At the end of the day, consumers like the utility and comfort that larger vehicles provide,” he said in a statement on the second day of the NADA convention. “Lower gasoline prices accelerate that shift.”
Szakaly predicts that of U.S. sales this year, 44 percent will be cars and 56 percent will be light trucks and SUVs.
The market share of pickups is expected to increase from 13.7 percent in 2014 to 15.2 percent this year. Crossover sales should grow from a 26.9 percent share last year to 28.1 percent this year.
The only car segment that is expected to grow is the luxury segment, Szakaly said.
NADA expects gross domestic product growth will be 3.1 percent in 2015, but said some economic concerns remain.
“The one big caution in all of this is that wages and income have not risen,” he said. “We are seeing a situation where consumer income is still at levels seen in 2008. We do need to see some sort of movement in this if we’re going to sustain automobile sales.”
Despite flat wages and incomes, Szakaly said low gas prices are helping keep money in consumers’ pockets, which they can then use to buy higher-priced vehicles.
“The bottom line is that it will be a good year for the consumers with great products that last longer, are more fuel efficient and are safer than ever before,” he said.
Some analysts have predicted new vehicle sales will rise to as much as 18 million by the end of the decade, but Szakaly doesn’t see it.
“It’s tough to see U.S. wages, incomes and population growing to that level,” he said. “I can see us sustain 16.4-16.7 million long-term, but 18 million is a stretch.”