Maryland new-car sales strong again in January

State's 0.9% increase in surprising contrast with nation's 5.2% dip

March 05, 2002|By Ted Shelsby | Ted Shelsby,SUN STAFF

Maryland motorists defied predictions and went on a new-car buying spree in January that resulted in a slight gain in sales over a very strong January 2001, according to figures released yesterday by the state Motor Vehicle Administration.

The 0.9 percent increase in sales made it the best January sales period for dealers since the MVA resumed releasing registration figures, which equate to sales, in 1991.

The rise compares with a dip of 5.2 percent in sales during January for dealers throughout the country.

"I was a bit surprised," said Peter Kitzmiller, president of the Maryland New Car and Truck Dealers Association, a trade group representing most of the state's 350 new-car dealers. "Everybody was expecting sales to be down. The economy seems to be pretty strong in Maryland."

There were concerns within the industry that lucrative rebates, including the popular zero-percent financing, during the last three months of 2001 had exhausted consumer demand.

While zero-percent financing was phased out in January, manufacturers offered aggressive incentives to boost sales, including cash rebates of up to $2,500.

"The market was stronger in Maryland than most people expected," said Jeffrey A. Foltz, editor of Maryland Auto Outlook, a marketing trade publication for state auto dealers.

"The truck market is still hot," Foltz said. "It hasn't changed. The big SUVs [sport utility vehicles] are very hot."

The same can be said for sport utility vehicles at the opposite end of the market, small vehicles such as the Ford Escape, Honda CRV and Toyota RAV4.

"They are selling extremely well," Foltz said.

Jerome H. Fader, president of Mile One, an automotive sales group that operates 35 new-car dealerships in Maryland, attributed the strong January sales to a combination of mild weather and increased consumer confidence.

"Our economy seems to be stable," Fader said. "And people are beginning to think this recession is not so terrible after all."

According to MVA figures, dealers sold 31,106 new cars and light trucks, including vans, sport utility vehicles and pickups, in January. That's 275 more cars and trucks than were sold in January 2001, which was up 17.5 percent over sales in January 2000.

Used-car sales posted a healthy 11.8 percent gain in sales during January over January 2001.

Raymond C. Nichols, chairman and chief executive of BSCAmerica Cos. Inc., a Bel Air-based holding company that operates used-car auctions in Maryland, Florida and Louisiana, said used-car sales benefited from a temporary dip in prices.

"There was a temporary glut of used cars on the market," he said, "and as a result buyers were finding some excellent buys."

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