New-car sales in Md. show 20% gain in Feb.

March 23, 1993|By Ted Shelsby | Ted Shelsby,Staff Writer

New-car fever swept through Maryland last month, providing the depressed industry with a healthy 20 percent sales boost compared with a year ago.

Despite this favorable sign, though, no one was ready to say for certain that the long sales slump was over or that the industry was high-gearing it out of the doldrums.

"We're definitely seeing increased sales," said Brian Fader, general sales manager of Owings Mills-based Heritage Automotive Group, a conglomerate of seven outlets selling 11 lines of cars. "Sales were up in December, January and again last month. . . . There's a lot of pent-up demand out there.

"We're getting a lot of 1980 through 1984 models in trade," he said, pointing out that during better economic times, dealers see more 2 1/2 -year-old cars being exchanged for new models.

Based on Motor Vehicle Administration (MVA) title registration figures, which reflect dealers' sales, consumers drove home in 18,275 new cars and trucks last month.

This compared with sales of 15,153 during the same 19-day selling period last year.

Despite the good showing of the February title registration figures, Jeffrey Legum, president of Westminster Motor Co., insists: "Things are not wonderful. I can tell you that."

Mr. Legum said that his Cadillac sales were strong and "Chevy pickups are doing real." But Chevrolet car sales, which appeal to an average, middle-income consumer, he said, were still struggling.

Still, Joseph P. Carroll, executive director of the Maryland New Car & Truck Dealers Association, is hopeful, but not convinced, that a sales boom was under way.

"We're optimistic, but we're also realistic," he said, noting that the February sales gain was posted over one of the weakest selling months of the past two years.

Mr. Carroll said that state dealers have posted strong single-month sales gains in the past year, "but it has been difficult for them to sustain the sales volume. They are hoping this is the beginning of a period of sustained growth."

They have been disappointed in the past. Last June, dealers posted a 25 percent gain, only to see sales drop off again in four of the past six months and end the year with a decline of 2.1 percent compared with the year earlier.

Mr. Legum explained that because of the difficult times, dealers have sharply reduced the number of cars in stock. As a result, he said, some buyers have had to place orders to get the car of their choice.

At his dealership, some cars that were ordered in December and January were delivered last month.

Michael A. Conte, director of regional economic studies at the University of Baltimore, saw the strong auto sales in February as another sign that Maryland could be emerging from the lingering recession that seems to have hit Maryland harder that most other states.

Mr. Conte expressed concern that the sharp jump in car sales could be a result of a large fleet order. "If we see a 20 percent gain in March and a 20 percent gain in April," he said, "than we've really got something."

But Peter Brinch, a spokesman for PHH Corp., a Hunt Valley-based fleet management company, said orders were about the same last month as they were in February 1992.

The MVA report also showed an increased consumer interest in used cars. Dealers sold 34,317 used cars last month, about 2 percent more then in the same period last year.

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