Car sales in isles forecast to rise 13%


POSTED: Wednesday, October 28, 2009

Hawaii vehicle sales will increase next year after four solid years of declines from a record high in 2005, according to research conducted for the Hawaii Automobile Dealers Association.

The quarterly Hawaii Auto Outlook projects a 12.9 percent increase for 2010.

However, the consensus among Hawaii's dealers is that the projection might be overly optimistic.

“;We have hit bottom, but there is some concern we may be bumping along the bottom through to the end of this year,”; said Dave Rolf, executive director of HADA.

The dealer association is marking its 50th anniversary this year, and the economy dampened the celebration.

Report producer Jeff Foltz “;has such an excellent handle on the whole country, including Hawaii,”; Rolf said.

Foltz monitors production schedules, inventory and other facets of the automobile industry as well as research by the economist for the National Automobile Dealers Association.

Nevertheless, local dealers' expectations run between 3 percent and 13 percent for next year, Rolf said.

In terms of actual numbers, light-vehicle registrations dipped 15.6 percent to 9,416 in the third quarter from 11,156 in the year-ago period.

Maui County has suffered the worst decline in auto sales year-to-date, down 41.6 percent. Big Island sales dropped 35.5 percent, Kauai sales were down 30.3 percent and Oahu is down 22.2 percent from a year ago.

Foltz's fourth-quarter projection for 2009 is 8,350 vehicle registrations, which is down from the third quarter but is a 6.9 percent increase over the 7,809 registered in the fourth quarter of last year.

“;Key market determinants are almost universally pointing to a sustained, albeit gradual, improvement,”; Foltz wrote. A quick recovery is “;highly unlikely, due to the weak employment outlook and the expectation of a slow recovery in tourism.”;

The U.S. government's “;Cash for Clunkers,”; or “;CARS,”; incentive program in late July, giving consumers $3,500 or $4,500 toward the purchase of a new vehicle with a better MPG rating, was responsible for the sale of 1,850 vehicles in Hawaii, Rolf noted.

Sales took a nose dive following the 3 1/2 weeks of the program.

The end of “;Cash for Clunkers”; was not the only reason for the sales downturn in early fall, Foltz reported. The resulting depletion of vehicle inventories was a factor, but primarily “;sales simply returned to pre-CARS levels,”; he wrote.

Hawaii consumers' tastes have changed in the wake of more-than-$4-a-gallon gasoline. The two types of cars purchased the most in Hawaii, year-to-date, are midsize crossover sport utility vehicles, such as the Toyota Highlander, and entry cars, such as the Honda Fit. The categories saw market share growth of 1.6 percent and 1.5 percent, respectively.

At the bottom of the market share scale are midsize cars, subcompact cars and full-size pickup trucks. Many of the latter are known gasoline gluttons whose MPG ratings equate to exotics like Lamborghini and Ferrari.


New retail light-vehicle registrations:

 2009*2008 CHANGE'09 MARKET
Light truck17,55822,624-22.4%51.5%
Detroit Three**7,1599,320-23.2%21.0%

* Forecast

** Detroit Three consists of vehicles sold by General Motors, Ford and Chrysler, and excludes import nameplates

Source: AutoCount, an Experian Company