The economy has been a source of much discussion over the last 18 months. We all know why because we have seen it affect our retirement accounts, luxury spending and industries that we work in. The automotive industry is no exception and has been struggling. The current benchmark for sales in one month has been August 2009 when the Cash-For-Clunkers program was instituted to jump start sales for the auto industry. Now news rolls in that we have surpassed that benchmark this July with expected sales to total at about 1,064,000.

The gains aren’t quite what industry players were hoping to see at this point, but a car sale is a car sale and a gain is definitely a gain. "July sales numbers should be the highest we've seen since last August's 'Cash for Clunkers' frenzy," reported Edmunds.com Senior Analyst Ray Zhou. "Retail demand for new cars this month has been the strongest of the year, even more than in March when Toyota launched an aggressive incentive campaign and other automakers followed suit." The rise from last year at the same time is about 8.4 percent with American car companies showing increases while companies like Toyota and Honda will post declines.

One manufacturer that is showing some of the highest increases for July is Nissan. Their sales for July are up 21.8 percent. If the new 2011 Nissan Leaf takes off, we would expect these numbers to continue. The real conclusion here is that it may be people’s perception that may be driving sales, not necessarily a better market. "Consumers have been conditioned to think that the summer is a great time to pick up a deal on a new car," said Edmunds.com senior analyst Jessica Caldwell. "The bargain-hunting mentality that reigns in the marketplace today - and automakers' ads promoting the clearance of old inventory - are driving people to dealerships in search of deals which, frankly, aren't all that generous this year." So beware if you are in the market for a new small car, summer might not actually buy you anything—what will matter is if you can score 0% financing and negotiate an attractive offer.

Until next time, be sure to browse all the current articles right here on AllSmallCars.com.

[Source: AutoObserver]