Pub. 14 2015-2016 Issue 4

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E N O . 1 , 2 0 1 6 10 new jersey auto retailer contagions spreading across the global economy encompass China’s own vehicle sales slowdown. Indeed, 2015 was set to be a down year in Chinese new vehicle sales until the government sharply reduced taxes on small cars. This led to a sudden surge in demand that has not ended. But taxes can only be cut so often and incentives can only go on for so long. As we learned in the U.S., consumers eventually take for granted low taxes and high incentives and the market crash that follows is very harsh. So, while we do have these general concerns about China, we also have specific concerns as to how Chinese vehicle sales relate to the future competitiveness of global manufacturers. Let’s remember that global profits drive product development, with some European and North American manufacturers particularly dependent on Chinese profits to drive R&D. Which brings us full circle to the U.S. market, one that is fundamentally stronger than China though also showing the beginnings of growing pains. We mentioned how the U.S. market has just finished six straight years of rising vehicle volumes and GLOBAL SLOWDOWN  continued from page 9 REAL SOLUTIONS FOR YOUR BUSINESS BENEFITS & INSURANCE CALL US TODAY. 800.601.0816 Our understanding of your business and your insurance needs is the basis for designing a benefits strategy that works.