Over the last three years consumers have become less and less confident in the longevity and value of new cars. The reasons are somewhat obvious. A large number of recalls, bankruptcy proceedings, and government bailouts have all rattled buyers who are expected to pay tens of thousands of dollars for a vehicle. Recent months have shown a change in consumer confidence levels, but will that turn around in perception help to fuel higher new car sales?
In February of 2010 consumers reported an abysmal 46.0 confidence rating for their new vehicles. One year later consumers are reporting their confidence levels at 70.4. While that is not a spectacular level of satisfaction, it is a stunning surge. Automobile financing companies cite overwhelming statistics that indicate confidence levels fuel new car sales. If you are happy with your new car, you will tell a friend and the ball rolls from there.
The February confidence levels mark the third consecutive month of increases and the highest levels in a year. So far sales of new vehicles have responded slowly, but it could take a while to reverse three years of dwindling confidence and shrinking sales. Hopefully, these numbers are a sign of good things to come. Combine this consumer confidence with fewer auto delinquencies and easing restrictions on second chance car loans on the part of the lenders, and the automotive industry is looking better for both buyers and sellers.