The auto industry’s premier promotional event of the year — the North American International Auto Show in Detroit — kicks off with two days of media events on Monday.
2015 was a great year for automakers, with vehicle sales topping 17 million and surpassing the record set in 2000. Sales were up by nearly 6 percent. Riding that wave of optimism, automakers including Ford, Cadillac, Volvo and Buick will be unveiling new models in Detroit.
“We still have relatively cheap and easy financing, pent-up demand — with the average vehicle in America 11-years-old, and gas prices have gone down,” said Karl Brauer, senior industry analyst at Kelley Blue Book. “You have plenty of people willing to not only buy a new car, but maybe buy a more expensive car, and/or a less fuel-efficient car, than they normally would have.”
New SUVs and pickups will be heavily hyped at the auto show, to help keep the sales juggernaut in those high-profit vehicles going strong in 2016. But Stephanie Brinley, auto analyst at IHS Global Insight, said that does not mean most buyers will drive away in new gas-guzzlers.
“These vehicles have gotten more efficient,” said Brinley. “So people can now buy that body-type that’s attractive because of its utility, without feeling guilty about having a low fuel-mileage vehicle.”
Luxury-car sales have been flying high, with sales at Jaguar, Land Rover, Tesla, Lexus, Audi and Porsche all up by double-digits in 2015. Ford will join the race with a new limited-production supercharged version of its GT sportscar, expected to cost $400,000.
Some of the world’s premier luxury brands, meanwhile, won’t be represented at the Detroit auto show this year, including Bentley, Jaguar, Maserati and Rolls-Royce, according to Bloomberg. Brauer said the decision to pass up on Detroit is not a slight at the Motor City. He said those automakers don’t have major new models to launch, and it’s not worth the estimated $5 million cost to show up.
After Detroit, the international auto-show season continues with major shows in Geneva, Paris, Beijing, Los Angeles and New York.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?