NADA: U.S. new car sales will fall to 17.1M in 2017
The National Automobile Dealers Association is predicting U.S. new car sales will fall to 17.1 million next year, down from a pace of around 17.4 million this year.
“We are headed toward a stable market for U.S. auto sales, not a growing market,” Steven Szakaly, chief economist of NADA, said in a statement. He spoke at a conference ahead of the Los Angeles Auto Show. “The industry has achieved record sales, and pent-up demand is effectively spent.”
Szakaly said the industry will continue to sell more light trucks. He predicts those vehicles will represent about 60 percent of the market next year.
The industry likely will finish 2016 down a bit from the record 17.47 million vehicles sold in the U.S. last year, according to the NADA. Through October, the industry had sold nearly 14.8 million vehicles, down 0.2 percent from the same months in 2015.
Szakaly said the economic outlook for 2017 is strong, with an estimated gross domestic product growth of 2.6 percent, employment growing by 150,000 to 180,000 a month and with gasoline prices of around $2 a gallon.
NADA, which represents about 16,500 dealers, believes the economy could benefit if regulations around fuel economy mandates are eased. But NADA still has some concern rising interest rates, longer loans and higher sales prices could lead to slower sales next year.
“It’s important to recognize that there are some political unknowns, but the economic outlook for 2017 looks extremely positive for auto sales, particularly light trucks,” Szakaly said in a statement. “New-vehicle sales will likely level off in response to the U.S. market maturing, not as a result of the election. If increased infrastructure spending happens and certain tax cuts materialize under the new administration, it will mean a better long-term outlook.”