The 2012 year-end (December 2012) Colorado Automobile Dealers Association “Colorado Auto Outlook” provides a wealth of information about what was an outstanding year for vehicle sales increases in Colorado*.
Data are available for more than 30 brands of new cars. All but two experienced growth in 2012 over 2011. For many brands, it’s fair to say the increases ranged from “substantial” to “spectacular.”
• Overall, Colorado new car and truck registrations rose 21.9 percent, beating the national average of 12.9 percent.
• Car registrations went up 25.6 percent and light trucks increased 19.1 percent.
• Japanese brands rebounded, climbing 26.9 percent compared to 23.9 percent for European brands, 19.1 percent for Detroit-based brands and 8.3 percent for Korean brands.
Two brands posted extraordinary unit sales growth during 2012: Smart was up 211.9 percent, although that represented an increase from just 59 to 184 cars, and Fiat registrations climbed 436.1 percent (from 97 to 520 cars). Eight other brands increased new vehicle registrations by more than 30 percent:
• Honda – 30.4 percent
• Chrysler – 31.2 percent
• Land Rover – 33.9 percent
• Infiniti – 34.0 percent
• Volkswagen – 36.5 percent
• Toyota/Scion – 36.5 percent
• Jeep – 39.3 percent
• Acura – 44.8 percent
Several brands increased their Colorado market share. Toyota/Scion’s went up by 1.6 market share points, followed by Jeep with an increase of 0.8 market share points. Brands with between 0.5 and 0.1 increases in market share points were Honda (0.5%), Volkswagen (0.4%), Fiat (0.3%), Acura (0.2%), Chrysler, Dodge, Infiniti, Nissan, and Smart (0.1%).
The turnaround stories behind most of these increases make them all the more impressive. For example, Chrysler Corp., which almost went out of business during the recession, came roaring back last year with Jeep, Dodge, Chrysler and Fiat brands all among the top 10. If counting the other important Chrysler Group brand, Ram Trucks, all five brands are in Top 15. The Japanese brands – Honda/Acura, Nissan/Infiniti, and Toyota/Scion, all were devastated by the 2011 earthquake/tsunami and subsequent nuclear meltdown, and also climbed into 2012’s top 10.
Changes in year-over-year new vehicle segment market share make it clear that Colorado consumers are still focused on increased fuel economy, with most of the growth occurring in small- and medium-size vehicle segments.
Back on track after long slide
While 2012 delivered the largest percentage increase in new car sales in the last 50 years or so, we still have a ways to go before we match the all-time high new car registration numbers set in the year 2000 – 158,630 in 2012, compared to 207,836 in 2000. Registrations declined from that high in most of the next nine years and in 2009 were about half of the 2000 high point (104,540). Interestingly, while registrations have been going up the last four years, they are not keeping up with Colorado’s significant population growth, which represents opportunity.
The Great Recession caused large drops in 2008 and 2009, but the long, slow decline between 2000 and 2009 has some other explanations. Vehicles are built to last with more safety features, greater durability, longevity and reliability. The result is a national fleet that averages 11 years, according to R.L. Polk. Clearly, the idea of trading in a car every couple of years to get the latest design details has gone the way of the dodo. Consumers often keep a vehicle, literally, until it dies. And with much better quality vehicles, that’s proving to be a long time. They also keep vehicles longer because they are financing them over much longer terms. While financing used to be for two- or three-year periods, now it averages six to seven years, encouraging car-owners to keep vehicles considerably longer.
Used car registrations up, but not as much as new
Largely due to shortage of supplies, registration increases were less dramatic for used vehicles, but there was still a 2.5 percent increase in year-over-year registrations. For the fourth quarter the change was smaller – up by 0.9 percent.
Japanese brands led the increase in Colorado retail used vehicle registrations, with an uptick of 7.2 percent, followed by Korean brands (3.7%) and European brands (0.9%). Used Detroit-made vehicles actually dropped for the year by 0.4 percent. Most of the used vehicle gains were among cars (5.3%). Used truck sales were up just a third of a percentage point (0.3%).
MINI was the clear winner for used vehicle registration totals with a 2012 increase of 27.6 percent. No American brands cracked the top 10. Jaguar (-26.4%) showed the largest loss, though in much smaller net volumes. But most of the other dramatic losses were among brands no longer sold new, such as Hummer, Pontiac, Saturn and Saab.
Changes in used vehicle market share were distributed unevenly by vehicle age. For example, two-year-old vehicle market share increased by 4.4 percent but plummeted by 8.2 percent for three-year-old vehicles. Again, lack of availability undoubtedly played a key role.
Be sure to check out the “Colorado Auto Outlook,” published monthly by Colorado Automobile Dealers Aassociation. It’s a great way to “look under the hood” at how our industry is faring.
• Data was provided by Experian Automotive and is published by Auto Outlook