An estimated 17.5 million automobiles were purchased last year, The Wall Street Journal reported. That’s up nearly 6 percent from 2014. Additionally, the average vehicle’s sticker price was higher than the previous year. Altogether, buyers spent roughly $570 billion on a new set of wheels.
Gasoline accounts for a substantial percentage of what auto buyers spend in ongoing car expenses. In the last 24 months, prices have waxed and waned. In 2013, the national average for a gallon of regular unleaded was $3.61, according to fuel price tracker GasBuddy. It fell to an average of $2 per gallon 12 month later, only to rise again to $2.80 in early June. Presently, thanks to a glut of oil produced, a gallon of unleaded runs an average of $1.94.
17.5 million cars sold in 2015
“17.5 million cars were sold last year, surpassing the previous record set in 2000.”
December car sales helped make 2015 a memorable year for the auto industry. New-vehicles purchases rose 13 percent from the same period in 2014, resulting in 1.7 million cars sold, according to vehicle valuation firm Kelley Blue Book. The total makes this past year the best one ever for new-car sales at 17.5 million, up 6.1 percent from 2014. In 2000, 17.3 million cars were sold, the previous record.
Tim Fleming, Kelley Blue Book analyst, noted that it’s little wonder December is a busy time for auto dealerships.
“[It’s] become one of the biggest sales months of the year, helped by year-end targets and prominent holiday sales events,” Fleming pointed out. “As we move into the new year, expect this strength to continue, although at a slower rate than this year.”
Sales won’t be slow enough to make it another record-breaking year, though. Fleming forecast a sales range between 17.5 million and 18 million.
Hefty hike in interest rates could derail sales surge
There are factors that could jeopardize 2016 being another stellar one for car sales. This includes rising interest rates, added inventory of off-lease vehicles and increased incentive spending among manufacturers. When incentive spending rises among automakers, it suggests that consumer demand is weakening.
Fueling the auto market’s robust year were buyers’ appetite for pickup trucks. Kelley Blue Book estimated roughly 241,000 full-size pickups were bought in December, up 14 percent on a year-over-year basis. Comparatively speaking, compact sport-utility vehicle sales totaled 238,000, approximately 216,000 for mid-size and 212,000 for compact.