Make us your home page
Instagram

Auto sales best in 6 years, but demand seen ebbing

Chrysler’s 2013 Ram pickup trucks and Dart sedans contributed to its 9 percent sales increase.

Associated Press (2013)

Chrysler’s 2013 Ram pickup trucks and Dart sedans contributed to its 9 percent sales increase.

DETROIT

Automakers are going to have to work a little harder for your business in 2014.

After four years of strong sales increases — and few discounts — as the economy improved, U.S. demand for new cars and trucks is expected to slow this year. That could mean better deals for buyers as car companies fight to increase their share of the market.

The industry got a taste of what's to come in December, when General Motors, Toyota and Volkswagen all saw their sales fall from December 2012. One reason: Competitors like Ford and Honda increased their incentive spending on hot sellers like pickup trucks and midsize cars, according to TrueCar.com, which tracks car prices. Cold weather and strong sales over Black Friday in November also pinched December sales, automakers said.

This year's slowdown is inevitable, analysts say. Many people who held on to their cars through the recession have now bought new ones. Those who haven't may not be in any rush, because cars are lasting longer than ever before. And unless there's a strong uptick in the economy, families aren't likely to buy a third car.

Alec Gutierrez, senior analyst for Kelley Blue Book, expects U.S. sales to increase by about 700,000 to 16.3 million in 2014. That compares with increases of more than 1 million each year since 2009, when U.S. sales bottomed out at 10.4 million.

"Sales are approaching an equilibrium level of demand based on the needs of population and the number of licensed drivers in the country," he said.

So 2013 could be remembered as the last of the boom years. As automakers reported full year sales Friday, analysts were expecting an increase of more than 1.2 million — or 8 percent — to about 15.6 million. It would be the best performance since 2007, when 16.1 million new cars and trucks were sold.

Ford led all major automakers in 2013 with an 11 percent gain to almost 2.5 million vehicles. Chrysler and Nissan posted 9 percent gains. GM, Toyota and Honda each posted 7 percent gains. GM sold 2.8 million cars and trucks in the United States, compared to just over 2.2 million for Toyota. Hyundai's sales rose 2.5 percent, while Volkswagen's fell 7 percent.

Gutierrez said Honda offered $3,000 in bonus cash to dealers in December for every vehicle they sold beyond their 2012 numbers. And Ford said it spent $600 more per vehicle on incentives in December, likely taking aim at GM's new pickup trucks. Those are the kinds of tricks buyers can expect to see more of this year.

"We think there's going to definitely be more competition," said Larry Dominique, president of Automotive Lease Guide, a company that tracks lease costs and car prices.

Industrywide inventory is rising, and that could also increase discounts because carmakers will have to sell off excess vehicles. But Kurt McNeil, GM's U.S. sales chief, said prices likely won't come down too much because the underlying economy is strong. Also, carmakers closed plants and got leaner during the recession, so the country is no longer seeing the kind of overproduction it saw a decade ago.

How 2013 went

The percentage change in total vehicles sold in the United States in 2013 compared with 2012 for major automakers:

Ø Ford: +11 percent

Ø Chrysler: +9 percent

Ø Nissan: +9 percent

Ø General Motors: +7 percent

Ø Toyota: +7 percent

Ø Honda: +7 percent

Ø Hyundai: +2.5 percent

ø Volkswagen: -7 percent

Auto sales best in 6 years, but demand seen ebbing 01/03/14 [Last modified: Friday, January 3, 2014 8:10pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Associated Press.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. McMansions, state sewage order on tap at St. Petersburg City Council

    Local Government

    ST. PETERSBURG — The City Council is set Thursday to vote on two major issues: controversial zoning changes aimed at curbing big McMansion-style homes and a consent order with the state that will require St. Petersburg to fix its ailing sewage system.

    Two big, blocky homes on the 2300 block of Dartmouth, Ave N under construction in April. Several new homes under construction.
in St. Petersburg's Historic Kenwood Neighborhood are too big, residents complain. The St. Petersburg City Council on Thursday is set to consider ordinances aimed at curbing the construction of big "McMansions." [LARA CERRI   |   Times]
  2. Tom James and wife, Mary, talk about their James Museum of Western and Wildlife Art

    Human Interest

    ST. PETERSBURG — As a child, businessman and philanthropist Tom James loved cowboy movies, an affinity that would later play out in a vast collection of Western art amassed over the years with his wife, Mary.

    Tom and Mary James at the site of the Tom and Mary James Museum of Western and Wildlife Art.
Photo courtesy of Raymond James
  3. A reliable Rick Scott ally, Pete Antonacci, named CEO of Enterprise Florida

    State Roundup

    Pete Antonacci, who last week made headlines when he advised scientists to stay in their lane rather than criticize his water agency's work on Everglades restoration, is getting a new job.

    Pete Antonacci, an attorney seen here in 2009, has served many roles for Gov. Rick Scott: general counsel, executive director of the South Florida Water Management District and now, CEO of Enterprise Florida.  [
COLIN HACKLEY | Special to the Times]
  4. Pinellas County budget on the rise thanks to high property values

    Local Government

    CLEARWATER –– After another year of growth, Pinellas County commissioners won't have to fight to pay for critical needs in the 2017-2018 budget.

    The Pinellas County Commission on Tuesday learned the first details of its $2.3 billion spending plan for next fiscal year, which includes funding for the Pinellas County Sheriff's Office. [Courtesy of Pinellas County Sheriff's Office]
  5. Tampa Bay chefs go head to head and Disney Springs gets another James Beard winner

    Food & Dining

    Epic Chef Showdown: Feeding Tampa Bay

    In a shoulder-to-shoulder format cook-off competition, chefs from Parkshore Grill and Mise En Place strove Monday night to become the Epic Chef of Tampa Bay. In this course, using ramen as a mystery box ingredient.