A Healthy Auto Industry is Good News for All

You may have already heard news of the recent boom in the U.S. auto industry. Many American automakers are operating close to 100% capacity. Auto sales are up 9% in June, continuing the trend that could lead the U.S. to its first 16 million unit year since ’07. Ford and Chrysler have even announced reduced summer shutdown time at their factories to meet the increasing demand for their cars and trucks. The spike in consumer demand is prompting the auto industry to go on a “hiring spree” that will include thousands of new employees ranging from technicians to factory workers.

But it is not just the automakers themselves who are manufacturing in high gear: auto suppliers are also feeling the heat when it comes to meeting consumer demand. Many parts suppliers are seeing the same sales success and increased orders that have trickled down from the major automakers. These hiring and production trends then continue on to many more areas of manufacturing. Suppliers, manufacturers, and distributors all benefit from the jump in new car sales. For example, Pucel manufactures many of the benches, cabinets, tables and carts used in machine shops and automotive plants, so if the auto plants are hiring more workers to make more cars, they will need more material handling equipment as well. Consequently, auto sales indirectly affect Pucel’s sales. The “trickle down” theory of economics can very easily be applied in this instance. While Pucel is surely feeling the positive effects of increasing demand for cars, it has been filtered down through a line of car dealerships, auto plants, distributors, and more. In this manner, many people end up benefitting from the purchase of a brand new car.

Demand for new cars and trucks suggests a boost in consumer confidence, which is great news for our economy as a whole. When Americans are willing to make a big purchase like a shiny new F-150, it often signals a healthier economy and more jobs.

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