Vehicle Sales to Remain Strong, Dealers Predict

This year’s U.S. vehicle sales probably will decline at least 1.8% if the nation goes to war with Iraq, but they should remain strong by historical standards, the National Automobile Dealers Assn. is predicting.

The group’s chief economist Paul Taylor, speaking at the organization’s 86th annual convention Sunday, projected new-car and light-truck sales of 16.5 million in 2003, down from 16.8 million last year, the fourth-best tally on record.

If the U.S. goes to war with Iraq, Taylor says, total volume probably will decline by an additional 200,000 vehicles as the conflict chills Americans’ spending.

His predictions are in line with most industry sales forecasts, which range from 15.9 million to about 17 million vehicles.

“Given that the preceding four years were the best in the history of automotive retailing, there’s momentum for the long run,” Taylor said. “Positive underlying economic fundamentals are working in the industry’s favor.”

Some of the 25,000 dealers and industry observers gathered in San Francisco said they’ve been encouraged by recent economic indicators, such as Friday’s news that Americans boosted their spending in December by the largest amount in five months.