Forecasting automobile sales

Abstract

Purpose – The purpose of this paper is to understand the behavior of the automotive industry which is very critical to avoid major economic disruptions in the economy. To understand this industry, one needs to understand its historical performance in relation to many economic factors that may affect the industry.Design/methodology/approach – Data about automobile sales (in dollars and in units) and many economic and demographic variables are collected from a variety of sources. Automobile sales are the dependent variable. However, the variable of automobile sales is divided into foreign and domestic car makers. The data are regressed using Statistical Package for the Social Sciences (SPSS) stepwise regression to obtain highly correlated variables.Findings – The results indicate a strong relationship between the economic variables and foreign car sales, but the relationship between the economic variables and domestic car sales is weak. The domestic cars sales relationship to the other economic variables sh...