Young buyers provide boost as auto sales hit all-time high
DETROIT — Americans are buying more new cars than ever before.
U.S. auto sales hit a record high of 17.47 million in 2015, topping the old record of 17.35 million set in 2000. Analysts expect sales could go even higher this year as unemployment continues to decline and more young buyers enter the market.
Automakers reported December and full-year sales Tuesday.
Low gas prices and historically low interest rates left more money in buyers’ pockets. Nationwide, gas prices ended the year at an average of $2 per gallon, according to AAA. And while the Federal Reserve raised a key interest rate in December, it remains near zero. By comparison, that rate was 6.2 percent in 2000.
Oliver Strauss, the chief economist at car buying site TrueCar.com, says the interest rate would have to reach 3 percent before it would cause car sales to stagnate.
Employment numbers also improved last year, so more buyers — particularly the huge generation of under-34 millennials — found they could finally afford a new car. People who held off purchases during the recession were also lured back into the market by enticing new vehicles like the Jeep Cherokee and the revamped Ford F-150 pickup. Ford sold 780,354 F-Series trucks last year — more than one every minute — making it the nation’s top-selling vehicle.
Analysts say the growth should continue this year, but at a slower pace. One reason: Millions of cars will be coming off two- and three-year leases and into the used car market, so some buyers who would have purchased new cars will go for used ones instead. Here are more details of 2015 sales:
Winners and losers
General Motors led all auto-makers in the U.S. last year, with sales up 5 percent to just over 3 million cars and trucks. Ford was the best-selling individual brand for the sixth straight year, with sales of just over 2.5 million. Volkswagen, meanwhile, saw sales plummet after it admitted in September that its diesel cars cheated on U.S. emissions tests. VW’s sales fell 5 percent for the year.
SUV love affair
As gas prices fell, Americans upsized. This fall, small SUVs became the largest segment of the market, at 14 percent, beating out small and midsize cars, KBB said. Unlike 2000, when the midsize Ford Explorer SUV was the nation’s third-best seller, small SUVs like the Honda CR-V are the now the vehicle of choice. Honda sold more than 900 CR-Vs every day in 2015; sales of the Nissan Rogue small SUV jumped 44 percent.
