Carmakers don't expect the tax increase on people making more than $400,000 a year to impact sales. Ford's chief economist says only 2 percent of new-vehicle buyers are in the top tax bracket. Audi of America President Scott Keogh says the increase won't cut disposable income enough to hurt luxury sales. He says the average income of an Audi buyer is about $191,000, not in the status-conscious top tax bracket. "We are not what I would call a frivolous, over-the-top vanity purchase," he said.
GM and Ford investors had a happy finish to 2012. Ford's stock price is trading at more than $13, up 22 percent over the past year. It has climbed steadily since October, when the company announced an overhaul of its struggling European operations. GM's stock price has jumped 42 percent in the past year and is now nearly $30. The carmaker turned a strong profit over the summer. It also restructured in Europe and has started buying back the government's stake in the company.
There's cause for optimism this year because of employment, housing and consumer confidence gains, said Jesse Toprak, vice president of industry trends for the TrueCar.com auto pricing site. Interest rates remain low. Fierce competition is holding car prices in check. And many people simply need to replace their cars, whether they were destroyed by Superstorm Sandy or because they're just getting too old. Toprak predicts that Americans will buy a million more cars this year than they did in 2012. Ford thinks sales could reach 16 million. The most recent high set in 2005 was nearly 17 million.
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