Car sales have been on a roll recently, hitting a record high last year with the streak continuing into 2016. Those hot sales numbers are expected to continue for the next few years, according to a new report from Bank of America Merrill Lynch.
Annual auto sales are expected to top 20 million by 2018, reported USA Today. So far this year, auto sales are on track to hit about 17.6 million, surpassing last year’s record peak of 17.4 million cars sold in the U.S.
Analysts predicted earlier this month that car sales had hit a peak and were set to start slowing, pointing out General Motor’s overall sales decline as a sign that the market had hit a cyclical peak. However, the latest “Car Wars” study by John Murphy, an analyst with Bank of America Merrill Lynch, says that the high-flying sales aren’t going to slow down too soon.
The report is closely watched by the industry, which includes analysis on upcoming product launches and the strengths and weaknesses of leading auto makers. General Motors (GM), Ford (F), and Honda (HMC) are all positioned to gain market share over the next four years given their strong lineup of new products, according to Murphy. Across the industry, auto makers are expected to launch about 58 new cars and trucks, on average, every year over the next four years, well above the average of 38 new vehicle launches per year.
“The fact of the matter is, demand for getting from A to B is up and is up dramatically,” said Murphy.
He predicts that the industry will hit its next cyclical slowdown “sometime in the next three to five years.”