2009 has been a very challenging year for the businesses in the CNMI, and the island’s car dealers are not immune to the difficulties.
The global economic crisis, the mass exodus of residents to the mainland and other countries to look for greener pasture, the onset of federalization and the uncertainty of their immigration status just some of the factors of the steadily decreasing figures in car sales for the past five years.
But the year ended with a positive result as sales for the month of December produced the highest increase for the year.
Statistics based on the monthly reports released by the Commonwealth Auto Dealer’s Association, the island’s three car dealers — Joeten Motors, Microl Corporation and Triple “J” Motors — showed total sales of 1,885 units sold in 2005. The figure dropped to 1,352 in 2006, 1,101 in 2007, and 966 in 2008.
Up and down trend in ‘09
For the first quarter of the year, the three dealers sold only a total of 203 brand new cars and this figure indicated a 32.3 percent dip in sales for brand new cars as compared to the sales for the first quarter of 2008 which was 300.
Sales for brand new cars continued to drop in April by 40 percent compared to the same month in 2008. The figures dipped lower in May when sales posted a 45.83 percent decrease.
From June to December, sales figures went on a see-saw trend. In June, the figures went up by 23.53 percent with the three car dealers selling a total of 42 brand new cars compared to the 34 units sold in June of 2008.
The June increase was momentary as a 44.62 percent drop in the July sales took over.
Sales picked up again in August, with the three dealers selling 60 brand new units and posting a 39.53 percent increase. The dealers sold only 43 units in August 2008.
By September, sales again dropped by 8.51 percent but slightly recovered in October with a 5.56 increase.
By November, sales for brand new cars dipped by 34.69 percent, brought about mainly by the impact of the takeover of the U.S. immigration as potential buyers hesitated to purchase automobiles.
But the December sales picked up, posting the highest increase of 72.97 percent for the total 64 brand new cars sold compared to the sales in December 2008.
From January to December, the three car dealers sold a total of 469 brand new cars, indicating a 21.18 percent overall decrease compared to the 595 units sold for 2008. The total cars sold last year are broken down into 246 sedans, 59 trucks, 23 vans, and 141 sport utility vehicles.
December brought in the highest number of brand new cars sold this year with 64 units, while May posted the lowest sales with only 26 units sold.
Of the three dealers, Microl Corp. sold the most number of brand new cars which totaled to 200 units, representing a 42.64 percent market share. Joeten Motors followed with 146 units sold and claiming a 31.13 percent market share. Triple “J” Motors’ 123 units sold represented 26.23 percent of the market share.
Popular car models
Toyota is the leading brand of cars sold by the three dealers for 2009. It sold a total of 194 brand new units. Nissan brand followed with 83 units sold, and Mazda came third with 59 units sold. Other brands were Honda — 36, Mitsubishi — 30; Hyundai — 27, Ford — 14, Kia — 13, Suzuki — 7, and Chevrolet — 6.
Used cars, an alternative
As the economy got tougher and the uncertainty got stronger, customers turned to used cars to pay lesser amounts for transportation expenses. The car dealers saw an increase in the sales of used cars.
From 2009, sales for used cars soared and reached a total of 380 units sold, nearly closing the gap with a difference of 89 units to level off with the sales for brand new cars.
Microl Corp. led the dealers in used car sales, selling 145 units during the 11-month period. Joeten Motors came next with 120 units, followed closely by Triple “J” who sold 115 units used cars for the year.
CADA president and Joeten Motors general manager Matthew Deets said that 2009 was a good year for used cars as consumers turn to it as an alternative to paying for brand new cars.
“Sales for used cars had been going up for the past two years,” he said.
Hopes for a better year
Triple “J” Motors general manager Randy Steele said that car sales for Triple “J” had been stable in 2009.
“We think consumers recognize the value in our products during these tough economic times,” Steele said.
He added that the federalization of the immigration in the commonwealth created a big impact.
“A huge number of potential buyers were taken out of the market to purchase an automobile due to their uncertain immigration status,” Steele said.
Deets said he sees 2010 as a stable year for the car dealers.
He said that with the federalization of the local immigration, more federal money and federal projects will be poured here and they are hoping for stability in terms of car sales for the year.
Microl Toyota general manager Doug Brennan said that while CADA was hoping 2009 sales figures remained at least at the same levels as 2008 (or improve), the apparent lack of consumer confidence in the CNMI economic future contributed to a drop in sales.
He said that Microl-Toyota did well.
“Austerity measures instituted over the past several years have allowed us to control operating expenses and remain a strong, viable company,” he said.
Brennan added that initially, the impending move to federalization caused the market to fall off.
“The actual influx of new Federal agencies has created a slight surge in the car market, but we don’t expect the surge to last,” he said.
He added that while they would like to see an improvement in the market, there are still many questions yet to be answered in regards to the future of the CNMI economy.
“We anticipate the passenger vehicle market to remain at about the same level as 2009,” he said.
This article was first published HERE