Kelley Blue Book recently released sales projections for the end of the year, indicating a strong year in the automotive industry. According to KBB, new car sales are expected to reach a 15 million units per month pace in 2013.
KBB, a leading provider of new car and used car information, said the strong auto sales year is mainly due to pent up demand from consumers, low interest rates available, attractive vehicle redesigns and introductions.
"These factors have kept vehicle sales moving forward despite powerful economic headwinds, and Kelley Blue Book analysts believe demand will remain strong enough to drive sales even further along next year," said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. "Although the economy is expected to continue to grow slowly in 2013, there is plenty of evidence to support another strong year of auto sales."
With car designs becoming more sturdy and improved automotive maintenance, vehicles are now lasting longer than ever before. Car owners are encouraged to use preventative maintenance, having their brakes, engine and lighting checked often in order to extend the life of their vehicle.
Gutierrez said that the average age of cars on the road has reached 11 years old. Along with the increasing lifespan of vehicles on the road, a large number of car leases are set to expire in 2013 and many Americans are expected to head to new car dealers, indicating high hopes again for the auto industry in the upcoming year.
New light vehicle sales are expected to reach 1,137,744 units in October, according to TrueCar.com. October sales translate to a 14.9 million seasonally adjusted annualized rate. Sales were up 11.5 percent when compared to October 2011 but were down 4.2 percent from September 2012, as this trend is typical during October as the summer buying season comes to a close and automakers reduce incentives on car purchases.
"New car sales are on automatic pilot," said Jesse Toprak, senior analyst at TrueCar.com. "October was a robust start to Q4 sales with most manufacturers posting double digit gains while continuing to lower incentives spending. We expect this recovery momentum to continue into the next year, with 2013 sales reaching 15.5 million units."
Retail sales were up 8.6 percent in October on a year-over-year comparison and down 3.9 percent on month-over-month comparison. Industry incentives averaged $2,353 in October, down 5.6 percent from October 2011, and down 2.9 percent from September 2012.