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Dealerships Getting More Traffic

November 24, 2011
2 min to read


Car dealers are getting a surprise end-of-the-year bonus: More Americans are replacing old cars and trucks, enlivening a normally sleepy time for auto sales and putting November on track to be the industry's strongest month of the year.


Dealers and analysts say people are finally getting rid of cars and trucks they've held onto for more than a decade. That demand, plus attractive lease deals, an ample supply of Japanese models and promotions on remaining 2011 models have drawn buyers to showrooms in large numbers in November, according to The Detroit News.

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"We're seeing the most showroom traffic that we've seen all year," said Ed Williamson, a partner in two Miami-area GM Buick-Cadillac-GMC dealerships.


The spike in activity comes after months of sputtering sales. Consumers have been reluctant to take on major debt such as car payments because of the uncertain job market. Unemployment has been around 9 percent for more than two years with no sign of significant improvement.


Sales also suffered when Honda Motor Co. and Toyota Motor Corp. ran short of models during the summer and early fall because of factory disruptions caused by the earthquake in Japan and flooding in Thailand.


Now supplies are starting to return to normal, and customers have a better selection.


So far this year, sales have been better than 2010, an annual rate of 12.6 million compared with 11.5 million, but that's still far short of the 2005 peak of 17 million.

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Recent sales have been so strong that General Motors' top sales executive predicts that November figures will hit an annual rate of around 13.8 million light vehicles in the U.S. That's a big step up from last November, when the auto industry was just starting to recover from the economic meltdown. Back then, the sales rate was only 12.3 million.


After years of holding off on purchases, people are tiring of their old cars and trucks. Lease deals also are drawing people into showrooms, Toprak said. Low interest rates and strong resale values after leases have ended help car companies offer deals.


Also, dealers are clearing out the remaining 2011 models. And by this time of year, automakers normally offer good discounts to get them sold.

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