Auto industry off to banner year, but not for all

Five years of straight sales growth in the auto industry in rare.

Six straight years? Hasn't happened, but this could be the year, experts say.

The U.S. is on track to sell more cars this year, though not as big an increase as 2014, says Thomas King, vice president for J.D. Power's Power Information Network. When it comes to so-called retail sales -- the typical individual buyer at a dealer as opposed to fleet buyers -- 14 million in new-vehicle sales, up from 13.6 million last year.

But even in such a vibrant sales environment, not all automakers will emerge winners.

"It's a great situation for the industry, another record year of consumer spending," King says. "But for everyone competing to succeed in the marketplace, life is going to be a bit more challenging."

Besides the overall better economy and cheap gas, the boom is being fostered by the return of sub-prime borrowers and Gen Y buyers, both of whom favor long-term loans that are coming more into favor. Long-term loans, typically those running 72 months or longer, now make up almost a third of sales, King says. The phenomenon hasn't hit danger levels yet, but "we need a very close eye on increasing longer loans," King says.

Against that backdrop, it might sound like another banner year for automakers. But King points out that it's still a rough industry. Some 142 new models are expected to be launched this year, up from 136 last year and a third more than in the dark days of 2009 and 2010. Only 59% of mainstream models saw sales growth last year, down from 71% in 2013. Plus, the industry has rising interest rates to fret about.

To their credit, automakers have maintained discipline when it comes to incentives and discounts. There is none of the overproduction that marked the industry a decade ago. Although average incentives have risen almost $300 per car on average in the past four years to $3,005, they are still below the recessionary $3,018 level of 2008, according to King.