NADA Chief Economist Paul Taylor

ORLANDO, Fla., Feb. 14—Some 11.9 million light vehicles will be sold in the United States in 2010, an increase of 14 percent over 2009, NADA Chief Economist Paul Taylor said during his annual convention forecast. Credit and consumer confidence are increasing, fuel prices are stabilizing, and stabilizing home values are contributing to a better sales climate, he added.

 

“It isn’t a huge recovery, but it’s a sustainable recovery,” said Taylor, “and all of that contributes to a market that we think is well on it way to improving. Frankly, we’ll get back to 15 million [units sold] in a few years, and we’ll all be thankful for that.”

 

But will consumers want the fuel-efficient cars the government wants them to buy? Taylor noted that hybrid vehicle sales have been sliding for the past two years. Still, consumers continue to migrate toward fuel-efficient crossovers from larger, more thirsty SUVs. Crossover sales rose 12 percent from last year, Taylor said, and he projects 10 more years of growth in that segment. Also, sales for midsize cars in January outpaced last year’s number by 21 percent.

 

Taylor said the used-car business returned to profitability, good news for dealers, who he said lost $5 on each used car they sold in 2008.

 

Jonathan Banks, senior director of editorial and data services for NADA Used Car Guide, said used sales will continue to rise through the year, with the luxury segment improving as home prices stabilize.

 

Gas prices remain the wild card, said Banks, and they could get volatile, with the price of, say, a used Ford F150 pickup truck swinging by as much as $2,000, depending on fuel costs.

 

Both Taylor and Banks said that the value of vehicles manufactured by Toyota would likely drop, and that of other companies’ products may increase, but over time that advantage would go away as Toyota’s prices decline to match the market.

 

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