Car dealers see a decline in sales in the islands .  So what do you care?  How does this effect you? In reading this article in the Honolulu Advertiser, the belief is that as the Hawaii auto market goes, so goes the rest of the economy.

“The car industry is always the canary in the coal mine,” Rolf said. “As long as new car sales in Hawai’i are above the floor level of 60,000, things are pretty good. When they get below 60,000, the economy is beginning to show some challenges. We are the harbinger of the future.”

OK? I had never heard this before, but if so, then what are the auto sales going to do this year and what does it mean?

With sales down significantly in just the first quarter, Hawai’i’s auto dealers are bracing for the possibility that sales for the entire year could drop below 60,000, which Rolf considers the basement level of a healthy economy in Hawai’i.

Leroy Laney, a Hawai’i Pacific University professor of economics and finance, said the latest new car sales figures are “a clear indication of a slowing economy. I am not surprised to see it.”

While some auto experts point to gas prices and deployments of local troops to Iraq and Afghanistan, Laney believes the sluggish start to 2007 merely represents the cyclical nature of Hawai’i’s economy and the inevitable slow-down in an auto selling industry that had been red hot the past few years.

We’ve had at least a decade, 11 years, of expansion,” Laney said. “But expansion doesn’t go on forever.

It always drives me nuts when the newspapers say slowdown sometimes.  I almost don’t trust their stories when they talk about this, because they paint the picture of a slowdown as the end to everything, when often times, as in the last few years, it means we had one heck of a growth spurt that isn’t sustainable at the same level over the long run and we have to get back to a more normal market.  I am not saying this is what they are saying here, but during our “Housing Slowdown” they painted one heck of a gloomy picture for our slowdown in 2006 and it ended up being our third busiest year in history. 

I always look for what the economist are saying in the article, and try to work around some of the fluff that helps sell newspapers.  Anyway…feel free to draw your own conclusions.