New-car sales, a leading indicator of Marylands economic health and consumer confidence, got off to a strong start in the new year, rising 8.4 percent in January.
Maryland dealers sold 26,236 new cars and trucks last month, according to registration figures released yesterday by the state Motor Vehicle Administration.
It was the best January sales showing since 1995, when Maryland motorists took delivery of 28,845 vehicles.
January is traditionally a slow month, said Peter Kitzmiller, president of the Maryland New Car and Truck Dealers Association, which represents the majority of the states 350 new-car dealers. But this January started out very well and stayed strong. It was more like a spring selling period.
Anirban Basu, director of applied economics for Towson Universitys Regional Economic Studies Institute, pointed out that the increase in car sales came during a period of rising interest rates. He attributed the flurry of showroom activity to the recent rate rises.
With interest rates on the increase, people are beginning to back off from purchasing new homes, and a lot of this money seems to be going into high-priced durable goods, including automobiles, Basu said.
Basu added that consumers have real spending power and are confident about the future.
The MVA reported that, according to its title-registration figures, last months sales compared with 24,210 in January 1999.
The MVA reported total used-vehicle sales in January at 36,294, down 2.2 percent from January 1999.
There were 20 selling days last month, compared with 19 in January 1999. Jerome H. Fader, president and chief operating officer of Atlantic Automotive Group of Owings Mills, one of the largest auto dealers in the state, said new-car sales were helped last month by manufacturers rebates and other incentives.
Fader said all the auto manufacturers, foreign and domestic, had incentive programs last month designed to boost sales. He blamed the slight dip in used-car sales on the manufacturers incentives to stimulate new-car sales.
New-car sales dipped into the used-car market, he said.