DETROIT -- August’s surge in U.S. auto demand could help lift this year’s sales totals above levels last seen in 2006, Edmunds.com analysts said.
Following last month’s surprise seasonally adjusted annual selling rate of 17.5 million, the car research and shopping site is sticking with its forecast of 16.4 million sales this year. But “there is definite potential for numbers to hit higher than that,” Edmunds chief economist Lacey Plache said in a meeting today with Automotive News.
U.S. light-vehicle sales totaled 16.6 million in 2006, the last full year before the recession. Demand dropped to 10.4 million in 2009 during the depths of the economic collapse and have risen by at least 1 million units annually through last year, when 15.6 million were sold.
While Edmunds hasn’t announced an official forecast for next year, Plache expects a total just shy of 17 million.
A rising number of consumers will be returning to the market next year as leases expire, she said. At the same time, a sixth year of rising sales will ease the pent-up demand that has been driving the recovery.
August’s 17.5 million SAAR, the highest since January 2006, surpassed Edmunds’ forecast of 16.9 million, largely because of unexpectedly strong sales over the Labor Day weekend. Plache said the sales rate this month will likely fall because some purchases that would have happened in September were pulled ahead.
One concern on the horizon: a rise in interest rates. Dealers and consumers will likely see the effects in 2016, Plache said.
Edmunds senior analyst Jessica Caldwell said “low interest rates have been a major growth driver in the industry.” She expects that automakers’ finance arms, as least initially, will counter that development by subsidizing lower rates.
“They’ll have to foot the bill for some of it,” she said.
Plache, meanwhile, saw no immediate concern in the increase in loans with terms of 72 months or more.
Consumers who have longer loans typically keep their cars for an extended number of years, rather than trading them in every few years, she said.