Local Auto Sales: On the Rebound?
REGION – Over the last several years in northwest Michigan we've seen the rise of full-size SUVs; Tahoes, Escalades and Hummers were all the rage. Today, none are among the top 15 sellers locally. We also witnessed the booming of Kias (two years ago, three of the top five local sellers were Kia models). Today, you'll only find one in the top 10.
Today's Traverse City top ten is a mixed bag, but one thing hasn't changed: pickup trucks sell Up North. It's a somewhat remarkable feat, given the steep decline in builders and contractors – trucks' most common buyers – but the Chevy C/K and Ford F-Series lead the way in local new car/truck sales.
Buick on the rise?
"I have to admit, I never thought I'd see the day," says Mike Marsh of the Bill Marsh Auto Group, referring to the trend of Buicks appealing to the 30-50 year-old set. For decades, the Buick name was associated with grandmas and grandpas, but some of the new models, including the Lacrosse and Regal, are beginning to change all that. The March 2010 issue of Motor Trend compared the LaCrosse to the Lexus ES 350. "We're seeing some fantastic styling and younger, professional Buick buyers."
A year ago, it was difficult to get a car loan, given the credit tightening and banking collapses. Today? "Credit's loosened up a little, and that's helping customers get financed" says Otto Belovich of Cherry Capital Cadillac Subaru and Traverse Motors, "but it's not what it was three years ago. If you're a slow pay, you're still going to have a hard time getting financed." Marsh says GM's recent acquisition of AmeriCredit will allow even more financing options.
Hybrids and electrics
Hybirds sales nationally have slumped of late due to lower prices at the pump and an economy where people are hesitant to pay extra for a green vehicle. Locally, they are holding their own, with local dealers collectively selling 24 hybrids in the third quarter. Says Belovich "When gas is $4 a gallon, you get demand, but at $3, they [hybrids] begin to show up on the used car lot." The first all-electric models, the Chevy Volt and Nissan Leaf, will arrive in some states late this fall, but aren't expected in northern Michigan until 2011.
Stability's the word
Local dealers and the numbers agree: after an incredibly tumultuous 2009, the auto industry is settling back down. Overall new car sales are crawling back, though still well below 2008 or 2007-type levels, General Motors is out of bankruptcy, and Chrysler seems to be on the rebound. "That stability from the manufacturers has made a huge difference," says Marsh. "They're turning out quality products, and the right number of products, too, so that there's not so many that the incentives are excessive. If anything, we have a hard time getting some models right now."
The Ford factor
John Cueter at Fox Grand Traverse has benefitted from a great resurgence at the 'Blue Oval.' Ford's stock is back, it's buzz is high, and awards and sales are following. "Fortunately, we're seeing growth across all of our lines right now [Ford, BMW, Mazda, and Mercedes]. But Ford in particular is helping us a great deal. People are excited about the direction of the company and the models."
Leasing back from dead
Over the last several years, a glut of cars coming "off lease" caused new car leasing to become virtually extinct. But according to Edmunds.com, leasing nationwide grew to 21.1 percent of U.S. sales through September, the highest point in several years. Due to poor new car sales over the last year or two, it's predicted fewer used cars will be hitting the market in 2-3 years, keeping residual values higher, and making leasing attractive again. "They're no longer putting incentives on every vehicle," says Belovich. "They'll find a hot model in your market, and go with them because the residuals are phenomenal." Belovich points to the Cadillac SRX, noting every one the dealer gets in stock is sold or leased immediately.
Take a look at the local top ten sellers and you'll see a vehicle that hasn't been there for a few years — the Chrysler Town & Country minivan. And you thought minivans were out of style? "They serve as a great replacement for those large SUVs. They seat seven, and they get much bett