As the auto industry rolls into 2018, it’s exiting one of the best years of sales ever.
Yet 2017’s sales dropped from 2016’s record year, from 17.5 million units to about 17.2 million.
So as the 2018 Philadelphia Auto Show comes to the Convention Center — Saturday, Jan. 27, through Sunday, Feb. 4 — are we facing an inevitable downturn in sales, propped up by a cut in prices?
Not hardly. Technological advances — in safety features, infotainment devices, and autonomous vehicle technology — keep the automobile industry looking to a bright future.
“The next three to four years will be accelerated, disruptive, and dazzling, all while laying the groundwork for generational change,” said Kevin Mazzucola, executive director of the Auto Dealers Association of Greater Philadelphia.
Here’s a look at where the industry stands and what the future may hold. (For a complete look at must-see cars, trucks, and activities at the show, check out the Jan. 26 DoThis section.)
Sales remain strong: Sales of any item can’t grow indefinitely, and vehicle sales are no different.
After bottoming out in 2009, vehicle sales have climbed every year since, to 17.5 million for the 2016 calendar year, according to Jessica Caldwell, senior analyst for Edmunds.com, the all-things-cars site based in Santa Monica.
For 2017, sales totaled 17.2 million, still a respectable number.
“I believe it’s the fourth strongest year ever,” Caldwell said.
While worry about excessive inventory and liquidation sales were the talk of last year’s auto show, and a reasonable prospect as automakers might try propping up sales, that doesn’t seem to have played out — yet. And it’s revealed in the numbers.
“Transaction prices are the highest ever, just north of $35,000,” Mazzucola said. “That’s amazing.”
SUVs and trucks remain king: Back in the olden days — 2012 — passenger cars and light trucks split sales 50-50.
In 2017, two trucks are sold for every car.
Of course, “crossover” and “SUV” have expanded their definitions. For example, Hyundai will unveil the Kona for 2018, a competitor for the Honda HRV and Mazda CX-3. But all three have cargo capacity around 45 cubic feet, which makes them about as spacious as a Hyundai Elantra hatchback.
“The idea of what an SUV is over the last few years has changed,” Caldwell said. “They are essentially passenger car replacement. They are slightly higher, with more flexible cargo space.”
Still, not every buyer is going smaller. Large trucks remain top sellers in the United States.
One might think the market is becoming saturated, but the timing of the overall sales slowdown almost couldn’t be better for large trucks. Plenty of models are getting revamped in the near future.
For the 2019 model year, Chevrolet plans to introduce its redesigned Silverado; Ram has a new 1500 — which has not been redesigned since 2009 — and Ford will return the midsize Ranger pickup to its lineup as well. In addition, an F150 diesel will give buyers a more economical choice from that recently redesigned model.
Though the Kona remains only a possibility, Mazzucola said, visitors to the Philadelphia Auto Show can expect to see the new Subaru Ascent and Jaguar E-Pace crossovers, plus the new Jeep Wrangler.
Electric motors are on the upswing: With General Motors and Volvo among companies preparing for an all-electric future and several European Union countries saying they’ll phase out the internal combustion engine, the future of electrics has never looked brighter.
Chevrolet released the Bolt in 2017, Nissan is putting out its second-generation Leaf right now, and the Tesla Model 3 has only had production started to fulfill back orders.
Caldwell says counting electrics, hybrids, and plug-ins, electrified vehicles were about 3.2 percent of sales through October, up from 2.8 percent in 2016. She expects they’ll reach 4.4 percent of the market for 2018.
Buyers are drawn to the latest technology: Though sales are flattening, Caldwell and Mazzucola agreed consumer focus has shifted.
“People are not replacing cars because they need to, but because of all the advancement in technology, Bluetooth and Apple Car Play, and now the move toward autonomy,” Caldwell said.
The change from “need” to “want” is what has driven sales even as incomes have remained fairly flat, Mazzucola said.
Still, the average age of a car traded is 6.2 years, and the average age of all vehicles on the road is 11.6 years. Both numbers remain on the rise, Caldwell said.
So to make sales and keep the future as bright as the last few years have been, it’s up to automakers to keep the innovation and excitement level high.
2018 Philadelphia Auto Show
Jan. 27-Feb. 4: Saturdays, 9 a.m. to 10 p.m.; Sunday, Jan. 28: 9 a.m. to 8 p.m. Weekdays: Noon to 10 p.m.; Sunday, Feb. 4: 9 a.m. to 6 p.m.
Where: The Pennsylvania Convention Center, 1101 Arch St., Philadelphia.
Prices: Age 13-61, $14; Active Military, $11; 62+, $7 weekdays; 7-12, $7; 6 & under free.