Colorado vehicle registrations for new cars and light trucks increased in May by 2.3 percent over May 2016, although auto dealers in Colorado Springs reported a 4.63 percent decrease in sales tax that was remitted to the city in May.
According to a sales tax report issued by the city of Colorado Spring, auto dealers in the Springs reported $1,090,641 in sales tax revenue in May 2016, but in May 2017 that fell to $1,040,187 — a decrease of $50,454.
“It’s hard to say why it dropped,” said Ben Faricy, who is president and partner with his brother, Paul, of The Faricy Boys. “We were up 10-11 percent in April and another 11 percent in May. It sounds like we may be bucking the trend a little bit.”
The only larger decrease in the May report for Colorado Springs was business services, which dropped 17.99 percent, or $55,509.
The May report was also bucking the trend for auto dealers — who showed a sales tax increase of 7.12 percent for the year, signaling an anomaly for the most recent report.
“People usually get their tax refunds in March, so we usually see a spike then more than we do in April,” Faricy said.
He said the trajectory could be changing overall for car dealers, both locally and nationally.
“The feeling we’re getting is that we’re at that plateau,” he said. “The market has been on a steady increase since 2009. The Colorado Springs economy continues to grow, so we might be a bright spot compared to what we’ll see nationally. Generally, we’re all expecting a plateau or soft landing.”
For the state, registrations for new cars and light trucks are up 4.3 percent for the first five months of 2017.
Data compiled by Experian Automotive for the Colorado Automobile Dealers Association shows year-to-date totals for new vehicle registrations were 85,599 compared to 82,077 a year ago — an increase of 4.3 percent.
May totals were 18,783 versus 18,353 for a year ago — a jump of 2.3 percent.
“Incentives from new vehicle manufacturers and dealers continue to be very attractive for consumers in Colorado,” said CADA President Tim Jackson in a news release. “Meanwhile, low unemployment, affordable interest rates and readily available credit for most buyers continues to drive new vehicle registrations into positive territory.”
Jackson said vehicle registrations have increased by more than 10 percent in 2017 for Audi, Honda, Infiniti, Jaguar, Lincoln, Mercedes, Subaru and Volkswagen.
Used vehicle registrations — which includes vehicles seven years old or newer — were up 9.8 percent through May.
In Colorado Springs, auto dealer sales tax revenue accounted for 9 percent of the city’s sales tax collections for May. Restaurants claimed the biggest piece of the pie with 15 percent collections, followed by building materials with 14 percent, miscellaneous retails with 13 percent, department and discount with 9 percent and hotel/motel with 6 percent. Grocery stores had 5 percent, as did furniture, appliances and electronics. Medical marijuana accounted for 1 percent of the collections.
The biggest increase in May over the previous year came from hotel/motel; it was up 28.71 percent with a jump of $266,394. Building materials was next with 20.99 percent and an increase of $151,873. Grocery stores showed increases of 17.18 percent and $98,007 from May 2016 to May 2017.