WASHINGTON—Continued economic improvement, low interest rates and cheap gasoline will help new-vehicle sales rise more than 3 percent to nearly 17 million units next year—the most since 2005—according to forecasts from the National Automobile Dealers Association.
NADA sees U.S. new vehicle sales growing to 16.9 million units in 2015 from a projected 16.4 million this year, as U.S. gross domestic product grows 3.1 percent, compared with an estimated 2.1 percent this year.
Through October, the industry sold 13.7 million vehicles in the U.S., up 6 percent over the same period of 2013.
But sales will begin to plateau or even decline after 2015 as the growing number car buyers with five- to seven-year financing deals delay their next purchase to pay down those long-term loans, NADA's chief economist said.
The monthly U.S. adjusted sales rate has topped 16 million vehicles for eight months in a row, and in August surpassed the 17.5 million mark, according to the Automotive News Data Center. The October rate was 16.5 million.
NADA projects that the economy will add some 242,000 new jobs per month next year, while consumers' disposable income rise by 2.5 percent. And while the Federal Reserve is expected to raise interest rates in 2015, NADA expects those increases to be marginal, allowing the low-interest-rate loans that have fueled auto sales to continue.
“Rising employment and wages, continued low interest rates and lower gasoline prices all signal an increase in new light-vehicle sales in 2015,” Steven Szakaly, NADA's chief economist, said in a statement today. “The economy will continue to build on the solid growth established in 2014, and we also expect the fundamental conditions to improve in the year ahead.”