Expert Predicts 'Small Pop' In Auto Sales This Month

NEW YORK–­An auto industry expert is forecasting a “small pop” in auto sales
in January but that auto sales will otherwise remain flat through the first
half of 2009.
Chrysler has already announced to dealers they will continue to offer huge
rebates into 2009 to offset the loss of leasing and low financing, according
to David Jacobson, CEO of GrooveCar, Inc. The move helps reduce the loan to
value on these loans, offering better equity to the lender, which in turn
results in more approvals and more cars sold, he said.
”As a result of the GAMC bailout, GMAC said they will offer low financing
again in 2009. However low financing is mostly available on certain models
and for shorter term loans,” Jacobson explained, noting that rebates will
also play a big role here.
”Although we expect car sales to make a small pop in January, we expect that
the lack of consumer confidence will spoil sustained increases in sales
through the first half of the year,” he suggested. “By the second half, a
combination of pepped up demand, access to funds, great prices (rebates,
etc.) and the returning confidence of both consumer and manufacturers should
drive up sales. The manufacturers will then start to build more cars and
dealers will return to local marketing to get their piece of the pie.”