Hawaii auto sales
rise 2.5%

The quarterly gain
comes as a surprise
to some local dealers

By Rick Daysog
Star-Bulletin

Despite a struggling local economy, sales of new cars and trucks in Hawaii rose a modest 2.5 percent during the second quarter of 1998.

A total of 10,802 vehicles were sold during the three months ending June 30, up from the year-earlier quarter's 10,536, according to the Hawaii Automobile Dealers' Association.

Import cars and trucks accounted for 5,700 of those sales, up 8.7 percent from second quarter 1997's 5,242. Sales of domestic models were down 3.6 percent during the second quarter to 5,102 from the year-earlier's 5,294.

For the first six months this year, local car dealers sold 20,524 vehicles, a slight 0.8 percent rise from 20,364 during the first half of 1997.

Nick Cutter, president of the Cutter Automotive Team, the state's largest auto retailer, said that sales of new models at his company's 11 locations were flat during the second quarter.

Including used-car sales, Cutter's volume was down about 8 percent during the quarter, he said.

The reasons: a struggling local economy and tighter credit, he said.

Many customers are cautious buying a new car during the tough economic times. And those who do want to buy a new car are having a harder time qualifying for a new-car loan, Cutter said.

"I think our business is no different than any other: Unless we see an improvement in our tourism industry, it's going to be a struggle," said Cutter.

Others were more positive about the market.

Ed Shikata, group vice president for automobile distribution at Servco Pacific Inc., said that sales at Servco's five company-owned Toyota dealerships and its Lexus franchise are a head of last year's pace.

Shikata said Toyota has been able to offer a good product line, boosting consumer demand.

"I think it surprises everybody that the market is holding up as well as it is," said Shikata, whose company also serves as the local distributor for Toyota.

Attractive incentives from manufacturers also have boosted sales at local car lots, some dealers say. For instance, customers looking to buy a Dodge or Plymouth Neon can chose between a $1,500 rebate or a loan with a low 2.9 percent interest-rate, said Don Mann, sales manager Windward Chrysler Plymouth Jeep and Windward Dodge.

"We're seeing less people but more buyers," Mann said.