LIHUE — Safety features, low interest rates and end of the year sales are among the driving factors behind the Garden Isle’s uptick in auto sales through the third quarter, according to local auto experts.
“Because there’s so many incentives on vehicles right now, it’s just about a good a time to buy a car that anybody can remember in the last couple of decades,” said David Rolf, executive director of the Hawaii Auto Dealers Association.
Through September, Kauai has posted some of the biggest gains in auto sales in the state, selling 1,845 vehicles compared to last year’s mark of 1,764. The gain represents a 4.6 percent increase.
“New cars are affordable, interest rates are low, the gasoline prices are low and the dealers just love explaining it to folks when they come in the showroom,” Rolf said.
Interest rates and cash back rebates are attracting customers, said Ryan Mackey, Kuhio Motors general manager.
“With the rates being at an all-time low, a lot of factories are able to offer zero percent financing. Everybody loves the opportunity for saving money with interest,” he said. “With zero percent, that’s a fantastic reason to come in and buy a car. Of course, some of the best incentives are out there on the market now, especially the light truck market.”
Though Kauai and Maui saw the biggest gains through September, Oahu — which makes up the bulk of the market — sold 30,796 vehicles this year, a 1.1 percent dip from the same time last year (31,130).
The end of the year forecast, however, remains strong and represents an upward trend of growth since 2010.
“It seems like every time we have a big presidential election, things kind of slow down going into the election,” Rolf said. “About a month afterwards, it kind of accelerates out. There’s some pent-up demand. We’re experiencing some of that in the state.”
From a safety standpoint, Mackey said vehicles are getting close to becoming autonomous and are giving consumers more incentives to buy.
“These vehicles are getting so smart they’re able to see what’s around them and help you avoid those collisions and drive safer,” he said. “That goes for every vehicle: truck, SUVs and cars all come with the option with some of these new technology.”
Mackey added: “I see the police are cracking down on people using their phones while they’re driving. Right now, manufacturers are putting in hands-free cell phone use. That keeps your eyes on the road at all times and you can listen to music through your phone or if you want to text, you can text via voice command.”
From his analysis, Rolf said there is also a direct correlation between home rates and vehicle purchases.
“As home prices are rising, the (vehicle purchase) chart continues to go up because people can take some of that additional money found in the equity they have and make a down payment and buy the car at very low interest rates,” he said. “As housing prices start to stay level, (vehicle purchases) seem to just recede because it has to do with general confidence.”
As the end of the year rolls around, Mackey said business owners scramble to invest.
“If they made some money, they can buy a commercial vehicle and use that purchase as a tax write off,” he said. “Right now, we’re starting to see a lot of people taking advantage of that. At the end of the year, people see where they’re at financially and make their decisions.”
The island also continues to see improve sales in the light truck category — trucks, SUVs and vans — as about three out of four purchases have been in that category.
“It might be because of Kauai having such an outdoor lifestyle,” Rolf said. “That’s one thing that always show up.”