While some parts of the economy remain a bit sluggish, automobile dealers appear to be pulling out of the recession.
Eager buyers have been keeping midstate dealerships busy for more than a year, especially last month.
Its been a very good year, said Chuck Tyler, general manager of Hughes Honda in Warner Robins. In August it was really the best jump weve seen all year long. ... Our sales jumped about 22 percent in August from year over year. ... I think its caught everybody by surprise, to be honest with you.
The recession appears to be in the rearview mirror for the U.S. automobile industry.
New car sales jumped 17 percent to 1.5 million in August, their highest level in more than six years. Toyota, Ford, Nissan, Honda, Chrysler and General Motors all posted double-digit gains over last August.
The full-year sales pace rose above 16 million for the first time since November 2007, the month before the Great Recession officially started. Automakers said sales likely will remain at that pace for the rest of this year.
Some Middle Georgia dealers say the increase in sales comes from a combination of things.
I think there is a lot of pent up demand out there, Tyler said. People have been holding onto cars. We see it in our service department.
Most of the sales Tyler is seeing are need-driven instead of want-driven, he said. People have kept their vehicles so long that sometimes it makes more sense to trade them than to keep getting their older vehicle repaired.
The cars on U.S. roads have reached a record average of 11.4 years old and need to be replaced. More people are working as the economy improves, and they need automobiles to commute to their jobs.
Terry Tiller, CEO and general manager of Riverside Ford Lincoln in Macon, agreed.
The cars we are trading in, lots of them have high mileage, he said. (People) have been hanging on, waiting for things to pick up. From what I read, we are not where we need to be, but we are feeling it (picking up). Maybe Macon is getting a little better.
Tiller said his sales this year are almost as good as 2007 before the U.S. economy tumbled.
It started in the fall (of 2012) ... and January was a really good month, and I had a good feeling. Its been good every month.
August was the best month all year, he said, which was surprising because there are a lot of distractions in August with kids going back to school and tax-free weekend. Nobody buys a car that weekend. They are all buying books or computers.
Some people are buying new cars because of an increase in used cars prices, said Forest Hutchinson, president of Hutchinson Auto Mall, a Buick, GMC, Cadillac dealership off Arkwright Road in north Bibb County.
A lot of buyers who can buy a new or a used (vehicle) we are seeing buy new because they are seeing what it costs to buy a used car, Hutchinson said. Just for a few dollars more they can buy a new car that nobodys driven, comes with a warranty (and) with all the latest features. Thats what were seeing.
Some people may think more used cars are available because car sales are up, but thats not necessarily the case, Hutchinson said.
The cash for clunkers program (in 2009) took a lot of used cars out of the market, he said. So, what were seeing is increasing used car prices. ... Used car demand is high. ... We are seeing used car buyers in a fight for the same car, which will drive up used car prices.
The Cash for Clunkers federal program was supposed to be a boon for the environment and the economy. During a limited time, consumers could trade in an old gas-guzzling car for up to $4,500 cash back towards the purchase of a fuel-efficient new car.
In Macon, weve been blessed, Hutchinson said. Weve not had some of the dips I read about in other cities, and because of that I do think people in Middle Georgia feel better than people in other states. A lot of people have been nervous about the economy, but they have been watching it for awhile, and its kind of moving along, so they say lets go buy something.
Total U.S. car and truck sales were 16 million in 2007, then plummeted during the recession. They bottomed out at 10.4 million in 2009 and have been rising ever since.
A lot of things have changed since 2007. In May of that year, the last time monthly sales topped 1.5 million, sales of small cars boomed as the nationwide average for gas topped $3 a gallon for the first time.
Drivers also have learned to live with higher gas prices. Gas this August was the cheapest in three years, averaging $3.57 a gallon nationwide, compared with $3.69 last year.
Spikes in gas prices tend to drive car sales, said Tiller with Riverside Ford.
More people will buy a car because it gets better mileage, he said.
But with gas prices down, Toyota was even discounting the Prius gas-electric hybrid last month to woo buyers who are no longer so concerned about gas prices. The average Prius incentive was $1,462, more than triple the incentives from a year ago, according to TrueCar.com, an auto pricing website. The incentives worked. Prius sales were up almost 30 percent.
Todays market looks different in other ways. In 2007, pickups made up 53 percent of U.S. sales. That fell to 47 percent in 2009, when construction ground to a halt. Now, truck sales are making a big comeback as contractors and other small businesses get back to work.
People who have to have a truck, will still buy trucks, Tiller said. We are selling trucks like crazy. Thats still our best-seller, and its Fords best-seller all over.
From January through August, truck sales made up 49 percent of total sales. Ford sold more than 70,000 F-Series pickups last month, the second month this year that sales have topped 70,000 for the nations top-selling vehicle.
Carmakers are offering more options, like navigation systems, satellite radio and blind spot detection, and thats driving up prices. Incentives are also down. Automakers closed plants during the recession and no longer need to offer expensive discounts to sell off excess inventory.
Despite the increase in new car sales, inventory is good for most models.
I think manufacturers have planned for this, said Tyler with Hughes Honda. They have been telling us for quite some time that the demand was going to increase. They have been producing vehicles at a rate that was out-pacing sales. Now we are back down to reasonable levels of inventory.
Tiller said Ford also ramped up the manufacture of certain lines.
In certain lines we are short like in the Ford Fusion, he said. I dont know that they anticipated sales to be as high as it is when they designed the car. So, its been short for some time.
Tiller said he usually gets what he needs by trading with other Ford dealers.
Tiller is encouraged by whats going on in the industry and what he sees locally.
Maybe Im wrong, but Im an optimist. You have to be (when youre) in the car business, Tiller said. But I think Macon is beginning to turn the corner. With the (Macon-Bibb County) consolidation and everything, I think its making people feel better.
The Associated Press contributed to this report. To contact writer Linda S. Morris, call 744-4223.