Even with a continued government shutdown and shaky economy, consumers are expected to invest millions in new cars next year
In spite of a national unemployment rate that tops 7 percent, Americans will purchase around 16 million new cars next year, according to a forecast from auto site Edmunds.com.
The auto industry will see another year of growth in 2014 with new car sales topping 16 million for the first time since 2007, the forecast said. Edmunds predicts sales of 16.4 million light vehicles in 2014, an increase of nearly 6 percent more than the 15.5 million expected in 2013.
Edmunds credits the new car sales to an increase in the average age of all light vehicles on the road, as well as, elevated used car prices.
Based on an Edmunds.com chart, growth in the auto industry, which bottomed out in 2009, dropped to less than 11 million cars sold; the number of cars sold has increased each year since then, with around 14.5 million sold in 2012.
Next year's car sales should also benefit from an expected 300,000 additional lease returners compared to 2013, who will lease or buy a new vehicle when their current leases terminate, according to the forecast.
While the forecast still looks good for the auto industry, growth has slowed. Auto sales will grow less in 2014 than in any year of the recovery to date, posting less than 6 percent growth and adding just 900,000 units to sales, said the forecast.
The slow in growth is due to a dwindling pool of pent-up demand as well as other economic hurdles faced by consumers. The economy should continue to improve next year with moderate growth, giving consumers the confidence to buy new cars. But those hit hardest, including young people, lower income households and small businesses, have not yet recovered enough from the recession.
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