NEW YORK: Falling US new vehicle sales through the rest of 2019 and into 2020 will bring more intense competition in the increasingly crowded market for SUVs and a continued decline in passenger car sales, executives and economists said at this week's auto show in New York.
After a long bull run, US auto sales are expected to fall about 3 per cent to 16.8 million units. That is still a respectable number, but the decline will increase competition for market share. While those bigger vehicles are far more profitable for automakers, increased competition could lead to higher incentives in that segment that could squeeze profit margins just like with sedans over the years, industry officials said.Executives also cited slowly climbing auto interest rates and the rising cost of new vehicles. Honda Senior Vice President Henio Arcangeli said uncertainty about the revised US tax code also had an impact on sales.
Patrick Manzi, senior economist at the National Automobile Dealers Association , said the growing competition favors those automakers bringing fresh vehicles to the market to grab consumers' attention.One way to stand out with an older vehicle is to offer steeper discounts to potential buyers, Manzi added.
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