Vehicle registrations in Hawaii were up 5.4 percent in the third quarter, slower than the 7.8 percent rise in the second quarter and slower than the national increase of 6.4 percent in the third quarter.
Still, for the first nine months of the year, vehicle sales were up 4.4 percent to 42,720, generally in line with the 4.7 percent national increase.
Sales are expected to continue to grow the rest of this year to 56,500, a 4.6 percent annual gain followed by a 3.3 percent gain next year, according to the latest Hawaii Auto Outlook prepared for the Hawaii Automobile Dealers Association.
The market share divide between sales of light trucks versus cars has deepened, with light trucks representing 55.1 percent of the market, versus cars’ 44.9 percent of the market, year
to date. That compares with 51.0 for light trucks and 49.0 for cars a year ago.
“The good news” about trucks, said Honolulu Ford President Mark Benson, “is that you look at the truck going down the road now, and it is not the same truck as it was 20 years ago.” Technology is getting better, and improvements in gas mileage have been “huge,” he said.
Benson, who is 6 feet 2 inches tall, said that big people “need something that has some size.” He worked for Honda for seven years early in his career. Additionally, if people are saving at the pump, they “go for more equipment on a vehicle. I really think there’s a love affair, not just with the safety, but they enjoy that size.”
Benson said he has seen consumer optimism positively affect sales before. “We’ve been through some tough times, and there may be some ahead, but we’re Americans and the free enterprise system is doing exactly what it is supposed to do. Whoever can provide what the market requests is going to be the victor,” Benson said.
While a construction boom on Oahu might receive partial credit for the 3.8 percent gain in light truck sales here, nowhere in the islands is the market share divide more pronounced than on Kauai.
“My opinion is that low gas prices have helped people afford trucks,” said Ryan Mackey, vice president of Kuhio Auto Group, which sells Nissan, Hyundai, Chevrolet, Cadillac, Ford and Mazda brands on the Garden Island.
On Kauai on a year-to-date basis, 69.1 percent of the vehicles registered were light trucks, up 5.8 percent from the same period last year, well above Hawaii island, where the light truck market share measured 61.7 percent, year to date.
When gas prices were through the roof a few years back, “a lot of people, it seems to me, stayed away from the truck market, but now that gas is more affordable, they’re coming back into the market,” Mackey said.
Lower gas prices are one factor generating more robust sales of trucks, sport utility vehicles and crossovers, Mackey said, adding that minivans also are considered light trucks.
“Kauai is such an outdoor recreational island, where outdoor activities and trucks go hand in hand,” he said. Larger vehicles “make it easier to drive” on Kauai’s roads and navigate potholes. Drivers “feel safer” when the know their vehicle can handle the road conditions, he said.
“When gas prices go down, people will move toward vehicles with more attributes, including interior space, towing capability, extra seating” and new technology, said Dave Rolf, longtime executive director of the Hawaii Automobile Dealers Association.
However, the hope among industry watchers is that low gas prices will enable consumers to go green and shift to alternative powertrain vehicles. A recent study by the Transportation Research Institute at the University of Michigan reported that the average fuel economy of new vehicles sold in October was 25 miles per gallon, down 0.2 mpg from September. The report attributes the decreased efficiency to lower gas prices that fueled increased sales of light trucks. While fuel economy is down 0.8 mpg from the peak of August 2014, it still has improved 4.9 miles per gallon since October 2007.
In Hawaii, registrations of hybrid and electric vehicles were at 5.2 percent of the market in the third quarter, trending a bit higher than the past three years.
However, registrations of electric-powered Tesla vehicles were up to 119, year to date, versus 64 last year at this time, for an increase of 86 percent. It led the 11 vehicle makes that saw the largest percentage increase in registrations, followed by Buick, Lincoln, Jaguar, Mini, Kia, Subaru, Porsche, Chevrolet, Chrysler and Dodge Ram. Still, Tesla’s year-to-date Hawaii market share is 0.3 percent.
The Toyota Corolla and Toyota Tacoma pickup truck remain the Hawaii market leaders, and Toyota overall dominates registrations with 27.4 percent market share, followed by Honda at 13.8 percent and Nissan at 10.7 percent.