Latest auto industry news explored

Automobiles selling fast, similar to housing market

Posted on 7/19/13 1:56:00 PM

Other than the housing market, the automobile industry is one of the top sectors to look at when discussing the health of the nation's economy.

And just like the hit the housing market took when the bubble burst, the auto industry was also hit hard by the recession that followed.

Now, though, consumers are headed back into showrooms and the auto industry is showing large gains year-over-year.

Increasingly confident buyers have pushed auto sales back to pre-recession levels through the first half of 2013. Sales from January to June of this year were more than 7.8 million, which was the best first half of a year since 2007, according to Autodata Corp. and Ward's AutoInfoBank.

Automakers recently revealed that June sales rose 9 nine percent year-over-year to 1.4 million units sold.

"It all points to continuing improvement in the auto market," said Mustafa Mohatarem, General Motors' chief economist.

The forecast for the rest of 2013 looks robust. Low interest rates, a wide net of available credit, innovative new vehicles and rising home construction are the key components boosting sales.

Industry experts are predicting total sales of cars and trucks to reach 15.5 million in 2013. That's more than a million more sold in 2012.

Cash-strapped families or individuals that own a home but have dim chances of grabbing struggle to afford a new automobile should look into a home equity line of credit. This allows a borrower to put their home down as collateral and in turn, a bank or financial institution will give them a line of credit for a car payment, home renovations or student loan repayment, to name a few.

Truck sales up
The sales throttle has been hit hard by demand for large pickup trucks. GM, Ford and Chrysler combined to sell 157,480 full-size pickup trucks in June. That's 25 percent more units sold than in the same month last year. It's also nearly double the number the trio sold in June 2009 when total sales plummeted to a 30-year low.

GM said that its Chevrolet Silverado and GMC Sierra trucks are spending an average of just 10 days on a dealer lot before being sold. Generally, a truck sits on a lot for roughly two months before being purchased.