NEW YORK Toyota Motor Corp's (7203.T) top North American executive on Thursday voiced optimism about the U.S. economy, and said the aging cars and trucks in consumers' garages will continue to drive industry demand this year.
Jim Lentz, newly appointed chief executive of North America, said the Japanese automaker sees U.S. industry new-car sales hitting 15.3 million this year, up from 14.5 million in 2012. Just six months ago, its 2013 forecast was for 14.7 million, but the company at the time believed talk of the fiscal cliff's impact would dampen the economy.
"We're cautiously optimistic about a growing economy, but there's still a lot of uncertainty that can derail the consumer's attitude," Lentz said in an interview after the New York Auto Show.
However, his fears are offset by consumers aging cars, which now average an all-time high of more than 11 years, and the improving mood of consumers as the housing and stock markets rise.
"When people can look at their 401ks and see that not only have they not fallen, but they are now starting to gain ... that is a real positive to overall consumer confidence," Lentz said.
Toyota should sell about 2.2 million cars and trucks under its three brands - Toyota, Lexus and Scion - this year, up from 2.08 million in 2012. The company is introducing nine new or updated vehicles this year.
Automakers are scheduled to report March U.S. sales on Tuesday and Lentz said Toyota expects the industry's annual sales rate to finish at about 15.4 million vehicles. That would mark the fifth straight month above the 15 million rate.
However, Toyota has no plans to revisit its full-year estimate at this point as Lentz said the company is forecasting the sales rate to slow to a range of 15.1 million to 15.2 million in the second quarter.
Lentz said a tightening of interest rates by the U.S. Federal Reserve would have a minimal impact this year and in 2014 on consumers, many of whom have monthly car payments.
"Whether you lease or whether you borrow money to buy a car, it's still all about the monthly payment," he said. "Right now, if you look at car payments relative to income, cars have probably never been cheaper even though the price of cars continues to go up. That monthly payment is still very fixed."
However, Lentz agreed that the high residual values that automakers are setting on their leased vehicles is not sustainable. He said Toyota is already adjusting its residual values going forward.
"In 2014-2015, this low, low lease party will come to an end," he said.
(This story was fixed to correct Jim Lentz' new title to say chief executive of North America, not U.S.A. in second paragraph )
(Reporting by Ben Klayman in New York; editing by Gunna Dickson)