After four near-record years, auto sales are expected to slow in 2019 but local dealers said the market will still remain healthy.
”When you look at where we’ve been the last several years, you keep waiting for a little bit of a turn. And is it where it was maybe two, three years ago? Not quite. But even last year was the fourth best year we’ve had in the automotive industry,” Dan Zinni, executive vice president of the Ohio Automobile Dealers Association, said Thursday at the opening of the Dayton Auto Show in the Dayton Convention Center.
Auto sales are an important indicator of the strength of the U.S. and local economies. Some of Ohio’s top manufacturers remain in the auto industry, including Honda, which employs more than 13,000 workers in this region.
Roughly 17 million vehicles are expected to be sold this year, forecasts Brian Moody, executive editor of Autotrader. That’s a dip from last years 17.7 million sales, which was slightly ahead of 2017’s 17.1 million.
One problem dealers are facing is that people are falling behind on auto loans, contributing to the expected decline this year, Moody said. SUV and truck sales also aren’t completely making up for the drop in sedan sales.
It’s too early to tell exactly how steel tariffs might impact consumers, but there are discussion in the auto industry revolving around how to pass on those additional costs, which could also decrease sales, Moody said.
As technology boosts car prices and consumers prefer more expensive SUVs and trucks, many are also turning to leases in the short term instead of buying, he said.
One of the biggest focuses on new vehicles this year, an ever-changing development, is technology — both for safety and entertainment. While the technology has existed for years, more and more cars in lower price ranges are adding Apple CarPlay for better communication between phone and vehicle and driver assistance features like lane keeping assist, forward collision warning and adaptive cruise control, Moody said.
“It used to be that you had to buy the luxury edition of whatever vehicle to get some of these features, that’s no longer the case. You’re seeing this in almost every vehicle that’s out there, or at least an option to be in every vehicle,” Zinni said.
Lloyd and Becky Smith of Tipp City, attending the Dayton Auto Show on Thursday, said they in the market for a new SUV and added technology is a selling point for them in choosing a new vehicle, especially for safety features.
»BIZ BEAT: Hobby Lobby plans 65 new stores this year
“It’s finally getting to the point where, I think, technology is beginning to make people’s lives easier and not so much in the way like it used to be,” Moody said.
But motorists looking for a new car shouldn’t assume features exist in every vehicle. It’s a good time to buy a vehicle because there are a lot of options, but for some drivers targeting specific vehicles, it may be better to wait another year until the technology is standard in that model.
Even though new technology is expensive and car sales could drop, Moody said automakers and dealers will have a profitable year.
“All auto makers will end up creating more of the vehicles that people want, which just so happens to be the higher profit trucks and SUVs,” Moody said. “So long as they can keep up by offering a variety of these SUVs and trucks in multiple segments…those are the ones that are going to continue to be profitable.”
But the auto industry’s profitability will come at some costs. Several automakers have announced cutbacks on production of compact cars and sedans as more motorists prefer larger SUVs and trucks.
GM announced plans to cut 1,600 jobs in the closing of its Lordstown, Ohio, vehicle assembly plant in Northeastern Ohio. The plant made Chevy Cruze, which has seen years of dropping sales. Four other U.S. GM plants that made sedans and compact cars will also close, impacting more than 14,000 workers in all.
“Trucks now outsell cars, so we’ve seen some of the manufacturers say we’re going to stop in this market with the sedans. I don’t think that will be a forever thing,” Zinni said. “It’s a thing that’s constantly changing and it’s just changing to what the demands of the consumer are now.”
Over the past 30 years he’s seen consumer preferences change from large trucks to cars that kept shrinking in size and then as gas prices dropped more people started looking for SUVs and pickup trucks.
Area car enthusiasts and potential buyers will find a selection of the newest automaker offerings this weekend at the Dayton Auto Show. The show this year includes an opportunity to get behind Toyota’s new C-HR crossover and chances to win a two-year lease on a 2018 Chevy Equinox LT.
Hours for the show are noon to 9 p.m. today, 10 a.m. to 9 p.m. Saturday and 10 a.m. to 6 p.m. Sunday.
FIVE FAST READS