NADA Predicts Best New-Car Sales since 2005 Next Year

Nov 17, 2014 06:10 PM EST | Jordan Ecarma

An optimistic recent forecast for the auto industry puts next year's sales at nearly 17 million units, which would mark a more than 3 percent increase year over year.

The National Automobile Dealers Association has projected that an improved economy, low interest rates and inexpensive gasoline will contribute to the best new-vehicle sales since 2005, Automotive News reported.

The auto industry reported sales of 13.7 million vehicles in the U.S. through October, an increase of 6 percent compared with the same period last year.

"The economy will continue to build on the solid growth established in 2014, and we also expect the fundamental conditions to improve in the year ahead," Steven Szakaly, NADA's chief economist, said in a statement quoted by Automotive News.

Szakaly predicts that auto sales will start to slow down and may even fall after next year since car buyers who are still paying off five- to seven-year leases will likely hold off on purchasing new vehicles.

The association has estimated that 16.4 million units will be sold this year, a figure that will grow to 16.94 million units in 2015. For U.S. vehicle sales to surpass 17 million next year, a combination of factors will have to be in play: bigger incentives from automakers, more purchases by younger buyers, wage growth and stable interest rates.

"Everything needs to go exactly right in terms of both the US economy and of course in terms of the global economy, and it's just unlikely to align that way," Szakaly said.

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