DETROIT -- The economic signs indicate a strong sales year for the auto industry in 2014.
And look for the recovery to continue for three years, says Steven Szakaly, the National Automobile Dealers Association's chief economist.
NADA predicts 16.4 million new cars and light trucks will be purchased or leased in the United States this year, Szakaly said.
That would be a 5 percent boost over 2013's sales of 15.6 million new light vehicles.
"We're going to see a very good year in 2014," Szakaly (pronounced ZAK'-lee) told Automotive News at the North American International Auto Show in Detroit.
Szakaly said the economy remains cyclical and there is a risk of political developments in Washington derailing the recovery. But he says a disruption is unlikely, adding that if one occurs, it probably would be minimal in its impact.
"I don't think there's anything on the horizon in the next three years that really indicates that this industry's going to turn down," Szakaly said. "We're cyclical as long as the economy keeps growing and there's no indication that that's going to slow down, either. I think we're looking at some very good years here for the industry as a whole, certainly sales above 16 million."
Stabilizing personal income, improving employment and a stronger housing market are driving growth in vehicle sales. Gross domestic product will grow by about 2.8 percent this year, Szakaly said.
"All of that makes consumers feel wealthier and all of those make them more positive and want to go out and buy that new vehicle," he said.
Szakaly expects factory incentive spending to remain stable and the overall auto industry to be profitable.
"There's a lot of demand, including pent-up demand. Vehicles are getting fairly old, averaging over 11 years now in the overall fleet," he said.
Szakaly added: "We've had a long recovery, but that's typical because debt-driven recessions have very long recoveries."