A House, a Truck and the Economy (Craig Douglass On Consumers)

by Craig Douglass  on Monday, May. 6, 2013 12:00 am  

Craig Douglass

Rising home values are also contributing to the increase in car and truck sales. As reported, consumers are feeling more confident, and that confidence translates not only to the purchase of a new home, but a new vehicle as well. We look again to Reuters, which reported that home prices in 20 metropolitan markets rose more than 8 percent in January from a year earlier. This is the largest yearly increase since June 2006. And new vehicle sales have paralleled this progress since GM and Chrysler went into bankruptcy in 2009.

As consumers act, the auto industry realizes a position right along with housing as leaders in the economic recovery. What is particularly telling is the fact that these increases have come in the first quarter of the year, a time that historically lags the rest of the year in home and auto sales due to poor weather. Who knows? The next three quarters may be gangbusters. We’ll wait and see.

Local Dealerships

The consulting firm Urban Science said in a February email to auto industry leaders that annual sales per auto dealer should reach an estimated 839 vehicles. That would best last year’s record by 27. A survey of local dealerships would have to confirm this estimate, as sales differ from market to market based on population and demographics. However, there is no doubt that vehicle sales, particularly the venerated pickup, are enjoying a surge based on housing and other construction activity. A welcome sign as we move into spring. Stay tuned. n

Craig Douglass is president of Craig Douglass Communications Inc. of Little Rock and a marketing and research consultant.

 

 

Please read our comments policy before commenting.
Search

Latest Arkansas Business Poll

Did the Fed make the right call on interest rates?