Honda Motor : Austin auto sales up 8.8 percent in first quarter of 2017
Sales of new cars and trucks were up 8.8 percent compared to the first three months of 2016, according to data from the Freeman Auto Report, a Dallas-based service that tracks those purchases in Bastrop, Blanco, Burnet, Caldwell, Hays, Travis and Williamson counties.
The strong quarter was driven by big gains in January and February. Figures show January sales jumped 10.4 percent and February sales soared by 22.4 percent. Sales were essentially flat in March, dipping 1.2 percent year over year.
A total of 30,380 vehicles rolled off dealers’ lots during those three months, Freeman found. That works out to 23,701 cars and 6,679 trucks.
It’s welcome news after a rare decline of 4.4 percent during the fourth quarter of 2016, including a 7.8 percent sales dip in December that ensured a full-year sales decline. New-car sales ended the year down 2.4 percent compared to 2015 — the first full-year Central Texas sales decline since 2011, according to Freeman.
“Just by virtue of Austin’s population growth year over year of around 7 percent, our business should grow by at least that amount,” said Will Hardeman, managing partner at Austin’s Continental Automotive Group, whose dealerships include Austin Infiniti, Austin Subaru, First Texas Honda and Mercedes-Benz of Austin. “We have a more consistent growth economy here than in other parts of the state because we have a more dynamic economy here.”
Elsewhere across Texas, cities such as Houston, for instance, whose economies depend on oil, have struggled as falling oil prices led to thousands of job cuts in recent years, he said.
Nationally, auto sales numbers are showing some weakness, according to Edmunds.com. The online car-shopping site says sales are trending down this year, citing data from IHS.
“After seven straight years of industry sales growth, every month in 2017 has shown a year-over-year sales decrease,” said Jessica Caldwell, a senior analyst and director of pricing and industry analysis for Edmunds. “Total sales are still strong from a historical perspective, but the record sales growth we’ve become accustomed to is coming to an end.”
‘New kid on the block’
The top-selling passenger car brands in the Austin area in the first quarter were Toyota, Honda, Chevrolet, Ford and Nissan, according to Freeman. Ford and Chevrolet alone accounted for more than half of all pickups sold in the region, followed by Ram, Toyota and GMC.
At his dealerships, Hardeman said Honda and Subaru, in particular, have been “growing very well and steadily.”
Locally and in many markets across the country, Hardeman said compact SUVs and compact crossover SUVs have become especially popular. Models include the Toyota RAV4, Subaru Forester, Honda CR-V and Kia Sportage.
“Every brand has one,” Hardeman said. “They’re the new kid on the block.”
Nationally, in April, the top-selling models were the Toyota Camry, Honda Civic, Toyota Corolla, Honda Accord and Chevrolet Cruze, according to Good Car Bad Car, a site that tracks auto sales data.
Good Car Bad Car says the Cruze, Hyundai Elantra, Hyundai Sonata, Kia Forte, Chevrolet Camaro and Subaru Impreza were some of the models reporting the biggest jumps in sales in April.
Austin dealers growing
As Austin grows, dealers are growing, too.
The Subaru brand, for instance, recently got a boost in exposure in Central Texas, thanks to Austin Subaru’s move into high-profile new digs at 8100 Burnet Road.
The dealership, which had previously been near the former Highland Mall, took over a building that was once home to a Ross store and a Chuck E. Cheese’s pizza restaurant. But you’d never know that after Continental Automotive Group spent months gutting and remodeling the interior and exterior.
It’s now the largest Subaru dealership, by size of the facility, in the country, Hardeman said.
“We’ve got more space here, double the square footage,” he said. “Not only were we able to expand our processes and eliminate some bottlenecks, but we’ve also got better road frontage. All that together will help us increase sales.”
Fiat of Austin is another dealership that has relocated in recent years, moving from The Domain to a spot at 13049 Research Blvd. in North Austin. Lexus of Lakeway, an offshoot of Lexus of Austin, set up shop at 108 S. RM 620 in the Lake Travis area. And North Carolina-based Hendrick Automotive Group, owner of Audi South Austin, bulldozed an abandoned Tinseltown movie theater to build a soon-to-open BMW dealership at 5501 S. Interstate 35 in South Austin.
Leasing to increase?
Hardeman, looking ahead to the rest of the year — and beyond — says he has noticed manufacturers offering more incentives to get prospective buyers into new cars, but he also sees interest rates “inching up just a little bit.”
“These two things will have some good and bad reverberations for the industry,” he said. “In the short run, it can mean more cars sell, but in the long run it can degrade the residual values of used cars on the market.”
With higher interest rates and lower residuals possibly on the horizon, Hardeman said he expects more folks to at least consider leasing a new car or even buying a used car instead.
“Lower residuals could make used cars an appealing option for a lot of people,” he said.
Fuente: 4 Traders