Sticker-Shock Vehicle Prices And Highest In A Decade New Car Interest Rates Depress US 1Q 2019 Auto Sales Down 2%

Automobile sales in the U.S. fell 2% in the first quarter, another sign the nation’s economy is starting to slow. Automakers sold just over 4 million vehicles from January through March, according to Ward’s Automotive Intelligence, and industry analysts blame the decline on rising vehicle prices, competition from an abundant supply of late-model used vehicles and relatively high interest rates. Weak sales of cars, harsh winter weather and the partial government shutdown also had an impact. Prices are a big factor.

The National Automobile Dealers’ Association reported that the average new vehicle sales price was $36,410 in the end of the first quarter, up 3.3% from a year ago. But even with a decline this quarter, auto sales are still healthy. Patrick Manzi, senior economist with the dealers’ association, said that although consumer confidence is waning, it remains high, showing that consumers still are willing to make large purchases. Also, job gains have been steady and wage growth has been accelerating.

Source: The Associated Press

Vehicle Interest Rates Rise; Zero-Percent Becomes Rare

As auto loan interest rates hit a 10-year high, the chances of finding zero-percent vehicle financing aren’t quite zero, but they’re getting slim, according to Edmunds the average interest rate on a new-vehicle loan last month hit its highest level in a decade.

It is expected to end up at an average 6.36%, compared with 5.66% last year and 4.44% five years ago. Vehicle affordability is on the minds of today’s auto dealers who worry that rising MSRPs and higher interest rates may price many potential buyers out of the market. Affordability was a common theme at this year’s National Automobile Dealers Assn.’s annual convention.

Source: WardsAuto