Toyota sees strong but slowing growth in 2014

Bob Carter: "Pent-up demand can carry you just so far."

Photo credit: JOE WILSSENS
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NEW ORLEANS -- Toyota Motor Sales U.S.A. has projected a slowing rate of growth in auto sales in 2014, and is taking a slightly less optimistic posture than most analysts regarding this year's sales tally.

Still, Bob Carter, Toyota senior vice president of automotive operations, said Toyota "hasn't been this bullish on the auto business in a lot of years."

Toyota expects the industry to finish 2014 at 16 million sales -- less than some forecasts as high as 16.4 million -- but Carter allowed for possibly stronger results. This fifth consecutive year of sales growth would be the first such occurrence since the 1930s.

"We believe the growth will be driven more by broad economic strength rather than pent-up demand. That's good, because pent-up demand can carry you just so far," Carter said in a speech here to the American International Automobile Dealers Association.

With economists projecting GDP growth of 2.8 percent this year and 3 percent in 2015, the unemployment rate dropping to about 6.5 percent, and household net worth climbing sharply, the climate for auto sales growth is robust, Carter said.

Another factor is historically low auto loan rates, which look to stay solidly in the 3- to 4-percent range, Carter said.

"Auto loan rates may tick up again as the Fed eases the stimulus, but we believe they'll stay relatively low and affordable for most Americans," Carter said.

Toyota's own forecast for 2014 is to reach 2.3 million Toyota, Lexus and Scion vehicles sold, a 100,000-unit gain compared to 2013.

You can reach Mark Rechtin at mrechtin@crain.com. -- Follow Mark on Twitter


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