US Auto Sales Hits New Record For 2016

Jan 06, 2017 06:20 AM EST | Jeroah Sabado

Auto sales in the United States rose for an unprecedented seventh straight year in 2016, beating the record set in 2015. Car companies sold 56,000 or 0.3 percent more vehicles last year. Lower gas prices, low interest rates, fatter discounts, and rise in employment kept car buyers coming to car dealerships last year. There was also the allure of new technology such as backup cameras, automatic engine braking and all new electric vehicles.

U.S. auto sales hits a fresh record in 2016, even as the industry employs more incentives to get Americans to buy vehicles. According to Autodata Corp., U.S. vehicle sales totaled 17.55 million, topping 2015's record of 17.47 million. General Motors, said as it was strong in December, reporting a 10 percent growth in sales. Its rivals had a less stellar month; Fiat Chrysler reported a 10 percent drop in sales and Ford saw a 0.3 percent gain with sales reaching to estimated 17.8 million.

Nissan's U.S. sales rose 5 percent last year to more than 1.5 million, a company record. Subaru also sets a record with sales up 6 percent to 615,132. Honda Motor's sales jumped 3 percent to more than 1.6 million. Hyundai's sales rose 2 percent to 775,005.

Still, the automakers managed to sell at rates near or better than 2016's strong levels. Lower gas prices, steady jobs and improving consumer confidence have helped the industry. Holiday promotions helped boost sales up 3 percent to 1.7 million, Autodata said. But even if sales had been flat compared with December 2015, 2016 would have broken a record.

However, the National Automobile Dealers Association expects U.S. auto sales to drop to 17.1 million vehicles in 2017. There will be a huge impact on the used car market since a large number of cars are coming off leases thus putting pressure on new car salesGovernment issues could also affect every major automaker that will then eventually affect auto sales. There has been a threatening tariff on vehicles in some parts of Mexico and the U.S., which is troublesome for automakers.

Automakers and dealers may dish out lavish incentives to attract buyers, but may face higher costs if the new administration implements trade restrictions. Car dealers are planning for continued good times with stores committing to upgrades or facility improvements.

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