The Rising Influence of Rising Affluence

[DewDiligence]

(CLF)—US auto production rebounds sharply:

https://www.wsj.com/articles/car-sales-2020-covid-19-11609798157

The U.S. auto industry is expected to report its lowest yearly sales tally in nearly a decade Tuesday, as the fallout from the Covid-19 crisis in 2020 upended a record run for the American auto sector. But a sharp bounceback in demand in the year’s second half led shoppers to pay record sums for new wheels, bolstering car-company profits and giving executives optimism for a sustained recovery in 2021.

…analysts say the conditions are ripe to further lift results this year, buoyed by near-record-low interest rates and another round of federal stimulus, including direct payments to some Americans beginning this week. Dealers and executives are optimistic the fallout from the pandemic will spur new-car demand as some consumers opt for personal-vehicle ownership over public transit or shared rides.

…Another factor, dealers say, is that some quarantine-weary American consumers—forced to forego travel and dining out—have spent their money on big-ticket items like boats, home projects and new cars.

…The average price paid for a vehicle in December was around $38,000, up from about $34,000 in early 2020, research firm J.D. Power estimates.

Market analysts expect 2021 US auto sales of about 16M, +10% YoY, but still below the 2019 volume.