Demand may be slowing, but U.S. consumers still bought a whole lot of cars and trucks in 2016.
U.S. sales of new vehicles – which set a record of 17.47 million in 2015 – could hit a new high in 2016. Consulting firm LMC Automotive and car-buying site Edmunds.com each predict sales will squeak past the old record and reach 17.5 million in 2016.
But after six straight years of sales gains – a string not seen since the 1920s – U.S. sales have reached a plateau. The National Automobile Dealers Association expects U.S. sales to drop to 17.1 million vehicles in 2017 as interest rates and vehicle prices rise. More buyers are also opting for longer loans, which means they won't be returning to dealerships any time soon.
For now, though, the market is strong. Nissan Motor Co.'s sales rose 5 per cent in 2016 to a new more than 1.5 million, a new company record. Ford Motor Co.'s sales were up less than 1 per cent to more than 2.6 million. Fiat Chrysler's sales were flat at 2.2 million.
General Motors Co. said its year-over-year sales were down 1.3 per cent from to just over 3 million cars and trucks. That was partly because the company cut back on low-profit sales to rental-car firms.
Other auto makers report December and full-year sales later Wednesday.
Low gas prices, rising employment and low interest rates kept buyers coming to car dealerships last year. There was also the lure of new technology – such as backup cameras, automatic emergency braking and Apple CarPlay – and new vehicles like the Chrysler Pacifica minivan, the Honda Civic and all-electric Chevrolet Bolt.
Rising incentives were also a factor, as auto makers tried to boost demand with deals like zero-per cent financing.