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Md. new-car sales dip, still reflect state's vigor


New-car sales declined slightly in Maryland last month, but dealers still posted their second-best April in the past decade, according to figures released yesterday by the state Motor Vehicle Administration.

The 0.7 percent decline from a strong April 2000 compares with a 10 percent drop in sales of cars and light trucks in the nation last month.

New cars usually represent the second-most-expensive purchase by consumers, behind homes. Economists view the figures as a leading indicator of the state's financial health.

"This shows that Maryland's economy has held up much better than the national economy," said Anirban Basu, director of applied economics at Towson University's RESI organization.

"It shows in the new-car sales figures," he said. "It shows in the home sales figures, and it shows in the unemployment rate.

"It says that Maryland has escaped the worst of the nation's economic slowdown."

Peter Kitzmiller, president of the Maryland New Car and Truck Dealers Association, said he had expected more of a sales dip last month. The Annapolis-based trade group represents the majority of the state's 350 new-car dealers.

"Business is a little tougher than last year," Kitzmiller said, "but last year was our best ever."

He indicated that more than strong consumer confidence is accounting for the robust showroom activity so far this year. "There is no question about it, the manufacturers are offering significant incentives to prime the pump to keep sales up," he said.

Sales more difficult

"The dealers that I have talked say it is becoming more and more difficult to get the same sales volume this year as they had last year."

Kitzmiller said sales vary from franchise to franchise. The Big Three [Ford, General Motors and DaimlerChrysler] posted sales declines of 15 percent or more during April. "At the same time, Toyota and Honda sales were very, very strong last month," he said. "Mitsubishi, Hyundai and Kia dealers are doing well. Kia is selling a lot of cars in Maryland."

Kitzmiller said the increase in gasoline prices "is having some impact on business, but it's not significant." Dealers say it is coming up in conversation with car buyers, whereas it has not in the past.

He said sales of the gas-guzzling sport utility vehicles are still strong, but have tapered off a bit from their red-hot selling pace of a year ago. The Ford Explorer, the nation's best-selling SUV, was the sixth-best-selling vehicle in the country in the nation last month.

$2 gas wouldn't help SUVs

"If gasoline goes to $2 a gallon and stays there, my personal opinion is that SUV sales will suffer," Kitzmiller said.

According to MVA title-registration figures, which equate to sales, state dealers sold 34,242 cars and light trucks last month. That was down from 34,485 in April 2000.

The average new-vehicle selling price was $22,474 last month, down $725 from March.

The MVA reported total used-vehicle sales in April at 52,807, up 5 percent from April 2000.

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