The sale of automobiles has been one of the most consistently reassuring economic indicators during the past few years, as automobile sales in the United States has steadily increased from their 2009 bottom. Although car purchases rose by 3.7% in February, they did move at a slower pace relative to last year. This fact reflects the notion that the possibility of job cuts and tax hikes amid budget debates in Washington have somewhat slowed consumer confidence regarding their job security, and, in turn, their disposable income. However, Ford’s U.S. sales chief came out and stated that the strength of this industry, determined by low interest rates and pent-up demand, have the potential to weather any storm that may arise from the sequester recently implemented. Many buyers have, therefore, been gradually returning to the market in order to purchase new vehicles.
Most American auto manufacturers saw sales surge, whereas many foreign car companies saw their sales in the U.S. decline. For instance, General Motors and Ford reported increases by 7.2% and 9.3% respectively, while Honda and Nissan witnessed their sales decline by 2% and 6.6% respectively. Performances this past month definitely make a statement for American car companies that, just a few years ago, needed government bail-outs. Additionally, it serves as a testament to the fact that American manufacturing is not completely over. Not only are these corporations producing valuable cars, but also their products are selling more than imports. Ultimately, the news regarding automobile sales in the United States finalizes a great week for the American economy, with a new record for the Dow, great reports about the services sector, and a positive direction for American car manufacturers.