Auto Industry Trends For 2012

Out With The Old And In With The New


After the roller coaster ride of 2011, the auto industry is due for a shift in gears. The new year always brings a promise of change and Edmunds.com has noted a number of trends that could help the industry leave 2011 in the dust. That new scent in the air? It's the famous "new car smell" for recession-weary car buyers finally taking the plunge to trade in their rambling wrecks, tempted by the latest technology and more freely flowing credit. With gas prices moderating, they won't necessarily be headed for compact cars, either. Newly designed top-sellers will draw buyers to the midsize car segment, and the compact crossover SUV segment should see some increased attention as well. Interest in the electric car is unlikely to increase much, but, after suffering from earthquake-related supply shortages, there could be substantial buzz around the new expanded line of Priuses, er, Prii, including the plug-in version of America's most popular hybrid. Regardless of what car buyers choose, though, they won't face the skimpy lots of 2011. Indeed, increases in production to restock and protect or gain share may even mean an excess of riches.

Of course, 2012 won't be an entirely brave new world. Tight supply will persist for used cars, keeping prices high and driving many would-be buyers to new cars. Uncertainty at home and economic threats from abroad will continue to constrain car sales. And America's love affair with trucks won't be ending any time soon—aging vehicles, stable gas prices, some revival of housing construction and easing credit conditions as well as increasing fuel efficiency for many truck models will help shore up a steady stream of buyers. In some cases, the more things change, the more they stay the same.

With 13.6 million sales forecast for 2012, the auto industry will be a key industry to follow in 2012. So, get your motor running, get out on the highway and stay tuned for the auto industry adventures of 2012.

Lacey Plache is the Chief Economist for Edmunds.com. Follow @AutoEconomist on Twitter.

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