Auto Sales Could Grow 70 Percent By 2015
Empty nesters and drivers sick of their old cars are going to fuel a huge spurt in new car buying, according to Michael Robinet, director of global production forecasts for IHS Automotive. Further enhancing growth is an increasing driving age U.S. population that is expected to grow annually by 9 percent over the next 10 years. Robinet made his remarks before the Automotive Press Association, according to an article in the Detroit Free Press.
Other factors need to drive increased sales beyond pent-up demand and population growth, though. Credit needs to become more accessible, unemployment levels need to drop, and the real estate market needs to rebound because some car purchasers have neither the credit nor disposable income because they are underwater on their mortgages.
Increased sales of this significance could come at a bad time for the American automotive industry. Declining domestic sales in the past couple of years have forced auto makers to look to overseas markets to bolster the bottom line. Without that incentive, manufacturers could see their fortunes wax and wane more frequently, which could hurt their viability.
The potential winners in the automotive growth scenario would be consumers. They would benefit from better prices caused by more competition. Also, auto makers that are flush with case from increased sales would have more money to invest in technological advancements.