US Auto Industry Predicted to Sell 16 Million Cars in 2014

The US auto industry is predicted to reach 16 million sales or more in 2014, a return to levels last seen in 2006 and 2007. According to the Automotive News Data Center, US auto sales will reach 15.6 million units in 2013, which means that it would only need to grow 3% in 2014 to reach 16 million.

"Back in 2006 and 2007 the industry was on illegal drugs — doing steroids. This time, the industry is reaching its goal all naturally — on the merit of the product. It's not being fueled by irresponsible lending or outrageous incentive spending,” said Jesse Toprak, of Toprak Consulting.

The return to record sales is also great news for automakers. Despite the records in 2006/2007, FordFordUnited States of America, 1903 > present92 models
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, GMGMUnited States of America, 1998 > present8 models
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and ChryslerChryslerUnited States of America, 1925 > present70 models
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were actually losing money at the time partially because of the deep discounts necessary to sell the cars. Since the recession, the automakers are more profitable, and there are about 4,000 fewer auto dealerships in the US.

The US unemployment rate is still somewhat high at 7.3% but has been on a gradual decline since a high of 10% in October 2009.

Ford is predicting even higher sales than analysts. It thinks that with the medium- and heavy-duty truck market included, sales could be near 17 million.

As conditions improve, sales will continue to rise, but analysts are already warning that sales of over 16 million cars a year in the US are not sustainable. Many of the people buying cars are replacing older vehicles that they kept during the recession. The sales will rise as these older vehicles are replaced, then gradually fall again but are unlikely to go as low as recession levels.

Source: Automotive News