Memorial Day has always been a big selling day for automotive dealers, and Kelley Blue Book (KBB) predicts this year will be no different. Sales from Memorial Day events are likely to fuel new car sales to nearly 1.4 million in the month of May, a 30 percent increase over the previous year, according to the news source.
New car sales have been brisk in 2012, but May is shaping up to be the best month yet, according to KBB's early projections. The major Memorial Day sales events will likely push new car sales further after what has already been a very good month for dealers.
In fact, recent gross domestic product (GDP) data for the United States shows car sales have been driving the economy. The U.S. GDP rose 2.2 percent in the first quarter, and nearly half of that was due to the auto industry.
"At this point, it is almost as if the tail is wagging the dog," said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. "During a typical post-recession recovery, we would expect to see auto sector gains being driven by broad economic growth. In the first quarter, the opposite was true, as auto sales were the primary driver behind GDP growth and have consistently been a bright spot in an otherwise slow-paced recovery."
Those hoping to take advantage of Memorial Day sales should make sure their trade-in vehicle is in working order. Fixing an auto repair before the dealer spots it can help raise the price of your trade.