All economic forecasts show 2014 as another bright spot in the Automotive Industry. Competitive pricing, credit availability, low interest rates, supply and demand and a great new model lineup will all contribute to positives for the consumers. It may be the best time ever to buy or lease a new car.
Credit bureau TransUnion tells Automotive News that Auto Finance Trends will remain positive in 2014. They predict easier access to credit for consumers, more leasing and bigger loans.
“Unless there is a real shock to the economy, we don’t envision auto loan debt levels to drop for quite some time,” Peter Turek, TransUnion’s vice president of automotive, said in a statement. “This is good news for dealers, lenders and consumers, as higher demand for autos will lead to more auto loans, creating incentives for consumers, as auto dealers and auto lenders compete for their business.”
Experian reports that the average interest rate for an auto loan has fallen to its lowest average ever (note: Experian began tacking interest rates in 2008). Monthly payment averages are low too. Nationally, the average monthly car payment is $458 per month, only $6 higher than averages compared in 2012.
In Ohio, auto financing averaged just 3.32%, putting the Buckeye State in the top 20 nationally, much below the national average of 3.65%.
According to Edmunds economic forecast: Economic conditions in 2014 also should mirror those in 2013, including moderate but steady economic growth and job creation, low interest rates and readily available credit, low inflation, a strong stock market, and improved housing prices. These conditions — and, in particular, their persistence over a number of months — inspire consumer confidence and motivate consumers to buy new cars.
More Leasing, Less Negotiating
As Edmunds lists its top ten industry trends, a push towards even more leasing in 2014 is predicted. The modern consumer is drawn towards getting the best bang for your buck, and Edmunds says there is no bigger bang than leasing.
Leasing has surged every year since 2009, and Edmunds predicts a 6 percent increase in leasing next year. With more than half a million vehicles coming off a 3-year lease in 2014, those shoppers will be in the market again for their next lease. Plus, Edmunds says more shoppers arrange funding through dealers, with leases and dealer-financing supporting more than 75% of of the transactions. Subsequently, cash and independent loans from third-party lenders will continue to decline.
Also, Edmunds says consumers more than ever want to lock in pricing and other terms of the sale prior to the sale. You’re in luck with the Waikem Auto Family. When you view our inventory and submit a quote through Waikem.com, you’ll first speak with our award-winning Internet Department. We pride ourselves in the full-disclosure sales process, and we’ll build you a custom quote on any new or used vehicle you are interested in.
Edmunds says: Regardless of how they pay, buyers will be less tolerant of the traditionally long-winded negotiations in the dealership, preferring instead to lock in the price and as many other terms of the deal as possible before arriving.
Submit a lead to Waikem, and you’ll see the Waikem advantage.
Supply and demand
We touched on demand earlier — half a million consumers will have expiring leases in 2014. But consumers are holding on to cars longer than ever, so experts expect a lot of customers will need a car in 2014. Edmunds forecasts 16.4 million car buyers in 2014, the highest numbers since 2007. During the recession, drivers held on to their cars longer than ever. In fact, a vehicle stayed on the road for on average 11.2 years in 2013 — the longest average age in the history of the industry. As a result, experts predict that vehicles will age to the point where drivers need to replace their ride in 2014.
“Forcing buyers who had delayed getting a new car to return to market,” Edmunds said. “With used car prices still elevated over past norms and used car supply still tight, the new car market will remain attractive to many of these buyers.”
Coming back around, TransUnion tells Automotive News that this new crop of shoppers will be attracted to leasing.
“With the number of new models being introduced this year and going into next year, leasing is going to be a great way for the manufacturers to get those new models out there,” Turek told Automotive News.
New car shoppers have a lot of choices if they’re buying a car this year. Building off the successful redesigns of the past few years, vehicles are now more fuel efficient than they have ever been. Vehicles are also more powerful then they have ever been.
And manufacturers are listening to consumers as well. New vehicles have new and better technology than ever before, and it’s easier than ever to stay connected while driving.
Take the redesigned 2014 Kia Soul for instance. Even at its base price you’ll get Bluetooth, 3-months of complimentary SiriusXM Radio, and USB/Auxiliary Inputs so you can plug your iPhone or MP3 player and listen to music over the speakers.
Manufacturers like Honda are equipping backup cameras standard on many top models, giving you the perfect blend of technology and safety.
Hyundai will see refreshed designs to popular models like the 2014 Hyundai Elantra, now standard with a 4.3-in color touch screen, and a new engine with even more power. All new Hyundai models will continue to come with a 10-year, 100,000 mile warranty.
Even the driver with the lighter wallet can drive home in a new car this year. Mitsubishi released the 2014 Mirage in Oct. 2013. The Mirage has a starting price less than $13,000, and with 44 MPG, it is currently the most fuel-efficient non-hybrid on the market.
Finally, do you want to know how well everything is going? Experian reports that vehicle repossessions have plummeted to their lowest figures ever. In fact, a repo man reports he is now out of a job because so many people are now able to make their car payments.
No matter what you are looking for, the Waikem Auto Family is here for you in 2014. We’ll always stock more than 200 used vehicles and more than 700 new cars for Ford, Nissan, Hyundai, Subaru, Honda, Kia and Mitsubishi. We work with more than 40 lenders to get you the lowest interest rates possible, and offer the full-disclosure sales process that makes the buying process easier you.