According to news reports this week, automobile sales have risen to extreme levels. This jump in new car sales is primarily due to a newly structured finance deal that has been working well to bring sales up and make auto maker happy.
Auto manufacturers nearly across the board reported strong April sales gains in the United States, powered by the continued rise in sales of pickup trucks and crossover sport utility vehicles.
The industry sold 1.45 million vehicles last month, up 4.6 percent from a year ago, according to Autodata. The seasonally adjusted annual rate rose to 16.5 million, up 450,000 from April 2014.
General Motors, the nation’s biggest automaker, posted a 6 percent increase last month compared with the previous year. It was its best month for crossover vehicle sales, which were up 25 percent companywide.
Ford also had its best month for S.U.V. sales. The shift by Americans away from cars has been striking. April was the 20th consecutive month that trucks and S.U.V.s outsold cars in the United States, according to Jessica Caldwell, senior analyst at Edmunds.com.
The rise of compact and subcompact S.U.V.s, which compete in price with traditional midsize sedans, has opened up sport utilities to consumers who previously could not afford them. Small S.U.V.s — like the forerunner Buick Encore, with sales up 29 percent in April for a 16th consecutive month of gains — are attracting not only those who are downsizing from larger vehicles, but especially drivers of smaller cars.
“A lot of people thought it would have an effect on larger S.U.V.s, but it’s actually having the strongest effect on small and midsize cars,” Ms. Caldwell said.
Dave Winslow, vice president for digital strategy at Dealertrack, said traffic at online car sites indicated a curious trend: Shoppers who research small cars, and even see them in person, are increasingly deciding on compact S.U.V.s when they actually get to a showroom.
“You may start off looking for a Camry and when you get there, come across a compact S.U.V. and decide to move up,” Mr. Winslow said. “They find out they can get a better value.”
Indeed, the typical small S.U.V. may cost only a few hundred dollars more than a comparable car. And gas mileage is increasingly competitive as well.
However, with this increase in auto sales and auto loans there will absolutely be a massive increase in auto repossessions as well. It’s just like corporate to think about the now and worry about the defaults of such loans later. This will be unavoidable especially with the sketchy economy and part time job conversions from full time jobs and or ending careers due to increasing regulations in almost every industry nationwide and world wide in many cases.