News Column

Corner Office -- Looking Ahead

November 12, 2010

Jesus Chavarria

The state of daily markets reflect
cascades of social and economic
data, as well as of political data and
events. How could we forget?
It's as if huge market turbines spin
zillions of transactions and in the process
create outcomes and trends. In the
automotive sector of the economy, 2010
has been a year of exceptional recovery
activity in many metro markets. Overall,
new automotive purchases are on the
rise, reflecting pent-up demand and the
arrival of exciting new product to market.
It should be noted Hispanic automotive
consumers have been critical participants
in the emerging industry turn-around.
Between September 2009 and September
2010, passenger cars sales ramped up l8
percent, and light truck sales rose even
higher, increasing an amazing 40.8 percent.
Automakers expect the trend to continue
into 2011.

The Chevrolet Impala, Ford F-Series
pickup, Toyota Prius and Chevrolet Silverado
led the charge of most in-demand automotive
product in America's dealer showrooms.
What's behind the success? Change to be
sure, huge change. In large measure, the
current automotive recovery stems from
a macro industry turnaround. America's
automakers have restructured, reorganized
and refocused on what their business is
all about. The auto business is all about
producing quality automotive product,
meeting transportation requirements
imposed by current market conditions, as
well as the personal taste and preferences of
today's automotive consumers.

The demographic composition of
America's consumer markets has continued
changing in a pattern confirmed in the
last decades of the 20th century. The
2010 Census expects to count 50 million
Hispanics, revealing a 42-percent increase
from the 2000 Census. Read the most recent
Bureau of Labor Statistics October 2010
Consumer Expenditure Survey, and one
fi nds Hispanic expenditures on new cars
and trucks in 2009 rising to $14.4 billion,
representing 9.2 percent of total U.S.
automotive expenditures. While spending
on new cars and trucks for all consumers
decreased by 0.6 percent in 2009, spending
by Hispanic consumers on new vehicles
rose 28.8 percent.

Automotive dealers have their own insights,
and they're to the point of actual contact
between product and consumers. They see
pent-up demand and the arrival of exciting
new product to market.

Mario Murgado, CEO and owner of Miami
Automotive Inc., a Buick and GMC dealer, is
not shy in saying loudly, "New product is the
whole key."

Fernando Falcon, owner of Champion
Chrysler in Indianapolis, Ind., recently
emerged from a national dealer meeting
cheering. "Just listening to my fellow dealers
talk about how excited they are to finally get
fresh product in their showrooms is a breath
of fresh air," he says.

In Palestine, Texas (just halfway between
Dallas and Houston), Fernando Valera, owner
of All Star Ford-Mercury, says of Ford's new
product, "Ford's quality is amazing, and I can
tell by my warranty dollars going down."
We're not talking about a rosy scenario,
mind you. The sales numbers sustain the
excitement. No doubt the automotive rebound
will continue with its dips and flows, but year
over year, the talk among dealers is guardedly
exuberant compared to what they've been
through.

Jesus Chavarria
Editor & Publisher



Source: HispanicBusiness


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