The new car sales bonanza in the United States seems to be coming to an end. Since 2010, automakers keep pushing past more and more sales records, but that accelerated growth is likely to slow at least some in the next few years. This is according to a new report from Automotive News, which talked with the chief economist at NADA.
According to the trusted industry resource, the upward trend of new car sales will continue in 2016, but then start to taper off in 2017. That doesn’t mean that sales will fall dramatically, just that everyone might not be able to report huge year-over-year growth figures like they have been for the last few years.
According to the NADA chief economist, a mixture of factors will push car sales even higher in 2016. The rate of employment is making it easier for consumers to qualify for loans, and cheap gas is another key. The rate of new households in the United States is also on the rise.
What anyone who’s looking for a new car needs to know is that likely automakers will start throwing out more incentives. This is estimated to happen in the latter part of 2016, which could make it a great time to buy a car.
There is a downside. NADA is predicting that interest rates will rise, especially for consumer who have little credit history or negative marks on their record. That alone could turn many to the used car market. The segments that are predicted to be affected most are entry-level models, such as subcompact cars and crossovers.
Stagnant wages were also cited as a reason for the used vehicle market to heat up.
Even though the United States is no longer in a recession, many in the automotive industry and other markets are still playing things safe. With an election coming up next year, quite a few economic changes could be down the line.