On the other hand, this might mean more incentives on your favorite cars.
Like a child who’s just discovered the miracle drug of caffeine, the auto industry has been bouncing off the walls in the past few years, beginning from a crushing low in 2008 to relegating 2015 and 2016 as periods of massive growth thanks to above average sales. Low gas prices and a renewed economy had something to do with the uptick, but growth can only go so far and as Automotive News reports, industry forecasters are already seeing signs of a downturn on the horizon.
It’s still a close call, but it appears that 2016 will end with the US auto market having gobbled up 17.6 million cars, up from 17.5 million in 2015. However, given the recent slowdown in the past few months, signaled in part by factory shut downs at America’s Big Three, it’s predicted that 2017 will only see 17.3 million car sales. All automakers are likely to suffer from the reduced dealership attendance, but the hardest hit will be the manufacturers that cater to those under the median income level. Luxury car buyers who are less impacted by fuel prices will keep buying cars and SUVs in droves, but a variety of factors are contributing to the budget tightening of those who make a bit less.
Michelle Krebs, senior analyst with Cox Automotive, puts it this way, “Rising gas prices, rising interest rates -- that just puts pressure on household budgets.” Despite these predictions, there is one variable, our president-elect Donald Trump, that could either help or hurt car sales in 2017. Trump has displayed a business friendly attitude, promising tax cuts and putting plans in place to reinvigorate America’s lacking infrastructure, both of which could serve to stimulate more vehicle sales (although the effects of these plans likely wouldn't be reflected until 2018). On the other hand, Trump has promised tariffs on imports, something that could damage the industry.
For automakers, 2016 might just be the high water mark for the 2010s, although given the feeling of uncertainty that seems to have run amok, it’s anyone’s guess really.