How much gas is left in auto sales rebound?
Consumers are expected to keep snapping up cars and trucks, due in part to the improving housing market.
Analysts say June could be the best month for car and truck sales since before the recession -- and the trend could stick around for awhile.
It’s been a good year for business at the Stew Hansen dealership in Des Moines, Iowa. There’s a simple reason for that: cars wear out.
General Manager Dan Boettcher says the average car trade-in these days is 10-years-old with 180,000 miles -- and trucks are even older. Now that the economy is looking up, lots of people are deciding it’s time to trade in that old clunker.
“A lot of the cars we’re taking in trade right now -- they’ve pretty much done their job,” Boettcher says. “And people are having to replace them.” Boettcher is counting on continued growth; he’s hiring more sales staff, accountants, and auto detailers.
That’s probably a smart move, says George Magliano, Senior Economist for IHS Automotive.
“This is gonna continue for an awful long time,” he says. Magliano predicts another four or five years growth in auto sales. The rebound started with Baby Boomers replacing old cars. But as the economy grows, Magliano says more Millennials will be kicking the tires.
“It’s not only reclaiming those people that lost their jobs in the recession -- but getting to the younger people who really haven’t had an opportunity to work at this point in time,” he says. And as the economy picks up, he says, those younger workers will need cars to get them to their new jobs.