Sales Of New Cars In Md. Soar

July 21, 1994|By Ted Shelsby | Ted Shelsby,Sun Staff Writer

Sales of new cars and trucks in Maryland have soared in the first half of the year, far outpacing the rest of the nation but leaving industry leaders uncertain as to why.

Sales jumped 21 percent in Maryland last month, and have risen 19.3 percent for the first six months of the year, according to figures compiled by the state Motor Vehicle Administration -- almost double the gains posted by dealers in the rest of the country.

Maryland dealers have posted higher sales every month this year when compared with the comparable period of 1993. In all but two months -- February and March -- the gains were 19.5 percent, or higher.

While the sales boom has state dealers happy, it also has them scratching their heads trying to figure out what is going on.

"We welcome the pickup in business, but I don't have the answers" to explain the surge, said Alan Abramson, president of Archway Ford on Reisterstown Road in Northwest Baltimore.

Steve Walters, an economics professor at Loyola College, had his own theory, but he wasn't certain that it was hitting on all cylinders.

"The economic recovery here has been lagging behind that of the nation as a whole and now it seems to be catching up," Mr. Walters said. "People feel a lot more comfortable about the outlook for the economy. They feel that their jobs are more secure than in the past. And now that they feel that they are not going to get laid off they are beginning to trade in their old jalopies."

He acknowledged that consumer confidence in the economy is gaining, and added, "but it's hard to believe our consumer confidence is three times higher than the rest of the nation."

Mr. Walters said that increased stability in the defense industry also could be a factor in making consumers feel more comfortable in taking on more debt. "There is a feeling on the street that we might have hit rock-bottom," he said. Maryland is the fifth-most-dependent state in the nation on the Pentagon budget, according to the Department of Economic and Employment Development.

Pent-up demand has to be a factor, said Joseph P. Carroll, executive director of the Maryland New Car and Truck Dealers Association, a trade group of retail dealers.

Ted Orme, a spokesman for the National Automobile Dealers Association in Arlington, Va., said that sales are strong throughout the entire mid-Atlantic region, particularly in Maryland, Virginia and Washington.

Mr. Abramson said he and other dealers are seeing more impulse buying this summer. He said that last year a higher percentage of sales were to motorists who needed to replace high-mileage vehicles.

The Motor Vehicle Administration figures show that 38,126 new vehicles were bought last month, compared to 31,368 in June of 1993. The average price was $17,670. This was slightly more than $1,300 above the average new vehicle price last year.

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