President Will Green of the Louisiana Automobile Dealers Association (LADA) believes that the strong group of auto dealers in the state will weather any storm 2019 may bring to the auto dealership industry.
“I can tell you that there are always uncertainties and changes in this industry, and there is no better group poised to handle that change than auto dealers,” Green said.
According to a recent piece on AutoNews.com, trends for this year may see sales for new vehicles dip below 17 million, a contrast to 2018 where 17.3 millions new vehicles were sold. High pricing for new vehicles may push consumers to look into the pre-owned market.
However used vehicle purchasing is projected to remain flat, again a contrast to a 3.1 percent growth the market saw last year. Edmunds, the online auto information resource, estimated that 40.3 million used vehicles were sold last year.
Green contributes the steady sales of used vehicles to the tumultuous nature of the economy and trade.
“The uncertainty around the economy, interest rates and tariffs, coupled with the quality vehicles customers were seeing come off leases helped drive used vehicle sales in 2018,” Green told Mega Dealer News. “I’m not sure how much of that has changed going into 2019.”
Additionally, the depreciation rate is expected to be higher; whereas last year’s depreciation rate was 12.4 percent, the rate for this year is anticipated to be as high as 15 percent.
While the 2019 trends forecast more SUV sales and a flatter year of sales in general, Green is not concerned about this negatively impacting auto dealers in Louisiana.
“My members tell me they are aware of the forecast, but they are going to continue to do what they always do, which is provide their customers with affordable options, both new or used and continue to adjust and evolve to meet the needs of a changing landscape,” Green said.