A new review of the North American car market by J.D. Power and Associates has concluded that industry-wide sales numbers are up from the second quarter of the year, but not as high as other numbers earlier in 2011. Basically, supply issues tend to plague the market, as well as the other half of the equation: lack of consumer confidence. The new J. D. Power report correlates with what has become general knowledge in today’s market: that as American job insecurity becomes a way of life, less buyers are willing to put huge amounts of money on the line by financing a new vehicle. This, plus a penny-pinching strategy of delaying any car or truck upgrade, produces the kinds of lackluster sales that experts have seen since the 2008 financial crisis. But now, according to the July release, analysts are seeing some green shoots in the auto industry. How these are going to play out over the next year, though, remains anybody’s guess.
J.D. Power has estimated this month’s overall new vehicle sales at 913,900, up about 8% from July 2010. Total vehicle sales are expected to top 1 million, which represents another sizeable year over year increase. There’s also a “seasonally adjusted annualized rate” or SAAR marked at 9.8 million units, up from 9.2 million last July. All of these figures are based on the first 13 selling days of this month, so some fluctuation could occur. J.D. Power and Associates analysts are mostly anticipating stronger sales in the second half of the year, with some caveats regarding a lack of verifiable results for light vehicles thus far. It remains to be seen how many Americans will be able to keep the auto industry going with high dollar purchases that carry successful financing contracts that are reasonable and have a low incidence of default. For consumers, the biggest resource is common sense in borrowing: make sure that any deal that you sign has ample room for any unforeseen financial problems, and you’ll be better positioned to ride out any storm and benefit from the long-term value of your car or truck. Common tactics that car buyers have profited from include making a bigger down payment to minimize interest, getting prime interest rates from lenders (often by demanding them,) and shopping around to third party lenders to find the best and easiest loan options. When it comes to auto loans, you have options, and a vast market is out these for exploration. Don’t limit yourself to the dealer’s back room for auto lending, but check around to see what bargain are on the table as the auto market picks up.