The Hawaii Auto Outlook released Monday says, “the majority of signs are pointing to a slowdown” in sales.
“As with just about any economic activity, vehicle sales intrinsically follow a cyclical pattern. New retail light vehicle registrations in Hawaii increased for seven consecutive years from 2011-2017, with the market increasing by 81% over the period,” the report said. “After such a strong run, the market was due for a contraction.”
There are signs that the market is running out of steam, according to the outlook sponsored by the Hawaii Automobile Dealers Association.
“Used vehicle prices have softened as several years of strong new vehicle sales have led to increasing supplies of late model cars and trucks,” the outlook said. “Lower prices for used models entices many consumers to shift their purchase intentions from new vehicles to used. Higher interest rates and increasing new vehicle prices have also hindered consumer affordability.”
Statewide, through March, there were 13,866 new vehicle registration, down 4.5% from 14,516 for the first three months of 2018. New car sales fell 5.9%, to 4,334 from 4,607, while light truck sales fell 3.8% to 9,532 from 9,902.
The outlook reported there were 692 vehicles sold on Kauai through March this year, down 1.8% from 705 sold in the first three months of 2018.
The light-truck market share of sales on Kauai was 79% through March, down from 81% for the same time frame last year.
The outlook said that on Kauai, Toyota earned 32.4% of market share for top 10 selling brands in the state, followed by Honda at 15.2%, Ford at 10.5%, Chevrolet at 7.1%, Nissan at 6.9% and Subaru at 6.4%,
Statewide, Toyota earned 34% of the market share, followed by Honda at 14.8 and Nissan at 7.6%
Domestic brand market share was highest in Kauai (30.2%) and lowest in Oahu (22.1%).
The state new vehicle market is expected to soften over the next several years, but sales should remain above average, based on historical standards, the outlook said.
The association’s outlook points out that unemployment rates are very low, incomes are moving higher, consumer sentiment is strong, and GDP growth is predicted to remain solidly positive.
“It would be unprecedented for new vehicle sales to collapse in an environment with such strong core economic fundamentals,” the report said. “In addition, technological advances in today’s new vehicles are a strong motivation for many consumers to upgrade.”