Forecast sees steady sales next 3 years, falloff later in decade
AutoPacific predicts steady growth in auto sales in the next three years, starting with 2015 sales just shy of 17 million in line with other forecasts.
U.S. sales recovery has been steady since hitting the bottom of the decline in 2009, though recent years have seen things taper off from 11 percent growth in 2010 to 6 percent in 2014, and a forecasted 3 percent growth this year, said Ed Kim, AutoPacificês vice president of industry analysis.
Kim sees nominal sales increases in the next three years, peaking at just above 17 million in 2017. Sales of light trucks and SUVs, and especially crossovers, will continue to increase. For this year, he expects a 55 percent light truck share, which would be a record.
AutoPacific foresees a drop in sales volumes later in the decade. The reasons: an expected increase in interest rates, continued delay by millennials in buying their first car, and continued longer loan terms that will make more buyers upside down on their current vehicle. The average loan is now 66 months.
Vehicle buyers will be in a negative equity position on their loans a lot longer than in the past, and that will have a profound impact on replacement demand in the future, Kim said.
Last week Standard & Poorês revised its sales forecast downward after lower-than-expected February sales. The financial services company looks for 2.5 percent sales growth for the rest of 2015 and flat sales next year.Download Bulletin PDF