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 12 new jersey auto retailer NewVehicleMarket Predicted To Remain Strong for Several More Years BY JEFF FOLTZ T he New Jersey new vehicle market has been on an amazing run, with new retail registrations increasing for six consecutive years. As shown on the accompanying graph, the market fell to 358,410 units in 2009 and recovered to more than 517,000 in 2015. That’s a 45% increase over the last six years! With sales reaching such high levels, there are concerns that the market has peaked. Indeed, the six year run of improving sales is largely unprecedented, and the automotive market has always followed the euphemism of “whatever goes up, must come down.” There are some other reasons to believe that the market is poised to move lower.When sales turned south in2008and2009,many consum- ers postponednewvehicle purchases, which gave a boost to themarket in the following years (i.e., pent up demand). Many analysts now feel this pent-up demand has been released and that the stimulative impact on sales iswaning. In addition, there are some serious concerns about the healthof the global economy. Although theU.S. andNewJersey labor markets have been adding jobs at a respectable pace,many economists feel that it is inevitable that, at some point, the residual impacts from a slowdown in the global economy will be felt here. This would have a negative impact on employment and household incomes, which would, in turn, put a crimp on new vehicle sales.