Kelley Blue Book on auto sales, growth in June
Monday, June 18, 2012
Kelley Blue Book, a top provider of new and used car information, recently reported on what it expects for the auto industry and markets as a whole in June.
The Blue Book Market Report for June 2012 revealed that demand for new cars will drive sales beyond the 14 million unit mark this year and that used car values dropped 3 percent in May as the result of falling oil prices. In addition, over the next three months, analysts for Kelley Blue Book predict used vehicle values will start to decline by as much as 7 percent.
Despite values remaining 20 percent higher than they were three years ago, they are still 3.7 percent lower than this same time last year. In addition, pent-up demand and loose credit are helping to promote sales growth.
"Affordable credit alone will not be sufficient to drive sales growth indefinitely, especially as pent-up demand levels off in the month ahead," said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. "Before the industry can rise to 16 million sales per year, we will need more significant and sustainable growth in the economy."
However, values of fuel-efficient vehicles have dropped between 2 and 3 percent in May with consumer demand falling due to a similar drop in gas prices. The previously popular hybrid car segment experienced the largest declines of 4 percent.
"Kelley Blue Book Market Intelligence data has shown for years that as pump prices rise, consumer demand and sales of fuel-efficient vehicles increase," Gutierrez added. "However, as soon as gas prices start falling 20 cents per gallon or more, car buyers flock back to SUVs and trucks in droves. To that end, values of fuel-efficient cars declined 2 to 3 percent in May as consumer demand eased with falling gas prices."
When it comes to used car prices, the National Automobile Dealers Association Used Car Guide found that they will drop 3 percent in July, due in part to moderate seasonal demand. Jonathan Banks, senior analyst with the NADA Used Car Guide, said that falling gas prices will result in greater depreciation of certain models.
Investors and those who want to diversify their financial portfolios can do so after equipping themselves with information related to the auto industry and sales as a whole. Discount brokers can be a useful asset when it comes to investing.
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