SANTA MONICA, Calif. — The auto industry can expect consumers who deferred their new car purchases last summer to continue their return to the market in the coming weeks, says Edmunds.com, the premier online resource for automotive information. As a result, the “mini-bubble” of new car sales that has popped up over the last few months is giving the industry a much-needed boost to close out 2011, and promises a notable start to 2012.
“New car buyers now have much better buying opportunities that just weren’t available this summer when productions shortages from the Japanese earthquake limited supply and raised prices,” says Edmunds.com Chief Economist Lacey Plache, PhD. “As a result, this ‘mini-bubble’ should support sales well into the first quarter of 2012.”
Edmunds.com estimates that consumers deferred 300,000 potential new car purchases over the summer. An estimated one-third – or 100,000 – of those deferred buyers have already returned to the market. Dr. Plache says that at least another 100,000 purchases should return to the market by March 2012. The fate of the remaining 100,000 deferred purchases, though, is a little more unclear.
“The exact number of remaining sales that will return – and their exact pace – depends on economic conditions, since some portion of buyers likely have been deterred by current economic uncertainty,” says Dr. Plache. “But positive trends in the U.S. economy, such as steady job growth, moderate inflation and income growth could reassure buyers enough to push them to finally make their new car purchases.”
Dr. Plache also says that while some of the deferred buyers may have turned to the used car market, the impact of this on the new car market will be minimal. Like their new car counterparts, used cars were also subject to tighter inventories and higher prices this summer due to increased demand for Japanese and fuel efficient cars by consumers and dealers. As a result, the ratio of new to used cars sold from May to August actually increased slightly to 0.33, compared to 0.32 for the same period last year.
For more details on the current “mini-bubble” in the automotive industry, please read Dr. Plache’s full analysis at http://www.autoobserver.com/
About Edmunds.com, Inc. (http://www.edmunds.com/help/
Edmunds.com Inc. publishes Web sites that empower, engage and educate automotive consumers, enthusiasts and insiders. Edmunds.com, the premier online resource for automotive information, launched in 1995 as the first automotive information Web site. Its mobile site, accessible from any smartphone atwww.edmunds.com, makes car pricing and other research tools available for car shoppers at dealerships and otherwise on the go. InsideLine.com is the most-read automotive enthusiast Web site. Its mobile site, accessible from any smartphone at www.insideline.com, features the wireless Web’s highest quality car photos and videos. AutoObserver.com provides insightful automotive industry commentary and analysis. Edmunds.com Inc. is headquartered in Santa Monica, California, and maintains a satellite office in suburban Detroit. Follow Edmunds.com on Twitter@edmunds and like Edmunds.com on Facebook athttp://www.facebook.com/