The U.S. auto industry should have a reason to celebrate over the upcoming Independence Day holiday; initial data suggest that increased industry discounting set off fireworks for consumers, sending them back to showrooms after May’s unexpected downturn.
But the trendline remains soft compared to the strong market of early 2011, and at least one study of consumer “intensity” suggests that the rebound may not last long, sales potentially slipping again in the months ahead.
June’s apparent upturn suggests that consumers are opening their pocketbooks again now that fuel prices have retreated a bit from an early spring surge. Meanwhile, manufacturers like Toyota have consciously bought momentum by ramping up their incentives. Makers had consciously trimmed back their giveaways over the spring – in large part responding to product shortages created by the March 11 earthquake and tsunami that devastated Japan.