Industry News: Analysts See A Quick Rebound In Car Sales

[William Maley]

Analysts believed that August was going to be the month the auto industry would post its first year-over-year increase for 2017. But then Hurricane Harvey hit Texas, leaving a path of destruction and extensive flooding. Sales for the month would drop 1.9 percent to 1.48 million vehicles when compared to the same month a year ago.

"Harvey will also depress one of the most critical selling periods of the year, spanning the August sales month close and Labor Day weekend. In 2016, these 11 days alone accounted for 4.1% of retail sales, or 580,000 units, nationally,” LMC Automotive said in a report.

But analysts believe sales - new and used - will bounce back in September. 

"We expect the recovery in vehicle sales to be quick. People need transportation to get their lives back in order, and in Houston, that transportation is the automobile," said Jonathan Smoke, chief economist for Cox Automotive.

Estimates from Kelly Blue Book puts the amount of vehicles damaged in Harvey between 300,000 to 500,000. 

As people get their checks from insurance companies and begin the process of finding a replacement vehicle, automakers are redirecting vehicles to their dealers in Texas. Because of this, Kelly Blue Book has bumped up their sales outlook for the year to top 17 million new vehicles sold.

Whether this pans out or not remains to be seen, especially as Hurricane Irma is projected to hit Florida sometime this weekend.

Source: Detroit Free Press

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[G. David Felt]

Good for the auto industry, but makes one wonder who will end up with a Lemon due to not all of these auto's getting crushed compared to some idiot who cleans up the auto and sells it to an unsuspecting person outside that area.

Wonder if there is a buyers list of how to check for a water logged auto? 

[daves87rs]

Don't count on it......

[balthazar]

I looked at a old car for sale a number of years ago- it was unregistered & had been sitting on the property for decades.

It was decent & I was considering making an offer (parts car) and I saw nothing suspicious... until I found silt on the tops of the sun visors & the door hinges. Owner had cleaned the interior completely but forgot there. I asked & he admitted- it had been under water in Hurricane Irene.

But this was a pre-electronics car- I wouldn't think a post-electronics car could possibly come thru immersion and still be functioning.

[G. David Felt]

Based on the stingy way insurance companies are paying out today, I suspect only 50% of these auto's will be replaced with new ones. 

I also suspect that many of these will find their way to the north and be resold as a clean low mileage auto. Buyer Beware! 

GOV should require all the auto's be crushed.

[balthazar]

1 hour ago, dfelt said:

GOV should require all the auto's be crushed.

That's why there's flood/salvage titles.

[G. David Felt]

32 minutes ago, balthazar said:

That's why there's flood/salvage titles.

Interesting, just learned that many norther states do not have these laws like the south as to why gently used auto's with low miles end up north and end up with issues due to being a flooded auto.

https://www.cars.com/articles/2014/09/storm-surge-beware-of-title-washed-cars/

With this I then found the gov site that covers this and even it states some norther states do not follow branding of an auto.

https://www.vehiclehistory.gov/nmvtis_consumers.html

What a crazy interesting world. Sad for auto buyers since it is buyer beware.

[Robert Hall]

34 minutes ago, balthazar said:

That's why there's flood/salvage titles.

Which are handled differently in each state, I've read some states are pretty lax WRT to such titles. 

[G. David Felt]

15 minutes ago, Cubical-aka-Moltar said:

Which are handled differently in each state, I've read some states are pretty lax WRT to such titles. 

Yup clearly stated in both the gov web site and the cars.com web site. Washing of titles. crazy.

[ccap41]

I know in IL if it was totaled out and I'm paid by my insurance company then it would have a "salvage" title if I wanted to buy it back. Not worth much with a "salvage" title or even a "rebuilt" title if you fixed a salvaged vehicle. 

[A Horse With No Name]

1 hour ago, ccap41 said:

I know in IL if it was totaled out and I'm paid by my insurance company then it would have a "salvage" title if I wanted to buy it back. Not worth much with a "salvage" title or even a "rebuilt" title if you fixed a salvaged vehicle. 

Only worth fixing them in certain cases.  My daughter writes off cars every day that are repairable but the value is too low to make repair feasible...often even with 2013 or 2014 vehicles.

[G34red]

Better to check the condition to see if the vehicle is still repairable.