NEW ORLEANS -- Steve Szakaly, chief economist for the National Automobile Dealers Association (NADA) and Jonathan Banks executive analyst for its used car division were pretty optimistic about the economy during a presentation here Saturday, at least as far as cars are concerned.
Szakaly said that overall economic activity is good, noting that the U.S. GDP grew at 2.5% last year and is expected to expand even more -- 2.8% -- this year.
"This is a very good, sustainable picture for the U.S. economy as a whole," he said. Personal income and employment are two areas that remain of some concern: there's not a lot of income growth and the unemployment rate remains high. There is pressure on consumers; the employment situation is improving but not at levels we'd like." That said, the NADA team sees the industry driving volume north of 16 million units.
There are, however, lots of positives at the macro level, he said, with household wealth strong and the likelihood that the Fed won't will raise interest rates any time soon.
Used car expert Banks, meanwhile, said the dance between the used and new-car market has shifted. Typically as one goes up the other goes down, but now both new and used-car sales are increasing in tandem."This has been the fourth year of increases for the used car market. It's a rising tide for both used and new, benefiting from improving conditions and consumer demand."