DALLAS — Big Tex has reason to smile.
The 55-foot cowboy statue that greets the State Fair of Texas' 2.5 million visitors here is peering out over yet another assortment of gleaming, gargantuan pickups from Ford, Chevrolet, Ram and Toyota, perched on towering displays that meet him at eye level.
Beyond the fairgrounds, too, things are looking brighter for the Texas auto market as parts of the state hardest hit by low oil prices and natural disasters start the long road to recovery, lifting a market that has underperformed in recent years.
Early signs from Houston and southeast Texas point not only to a quick rebound in sales of new and used cars following Hurricane Harvey in August, but also to an upward trend in coming months as residents replace hundreds of thousands of damaged vehicles. The Federal Reserve Bank of Dallas said last week that the medium-term outlook for the region is positive because Houston and the Gulf Coast are expected to recover quickly and generate jobs needed for rebuilding.
That's welcome news for automakers and Texas auto dealers. The state is the nation's No. 1 market for full-size pickups, one of the industry's most profitable segments. But weakness in the oil patch around Houston and South Texas has eliminated many high-paying jobs and been a drag on an otherwise healthy economy. Houston still has low unemployment at about 5 percent, compared with 4.2 percent statewide, but the auto-market mix in the state's biggest city has shifted toward lower-priced vehicles and used cars.
New-vehicle sales peaked in Texas in 2015 at about 1.6 million units, and have trended down since then. This year, new light-vehicle registrations in Texas were down 4.1 percent through July, according to IHS Markit. (Pickup sales were up 4.1 percent and made up about 200,000 of the 870,473 vehicles sold.)
August's hurricane and flooding put another dent in sales in South Texas, according to Steve McDowell, owner of InfoNation, which compiles registration data for the TexAuto Facts report.
But Steven Wolf, chairman of the Houston Automobile Dealers Association, said there has since been a big spike in customers streaming into dealerships after quick settlements with their insurers. They are mostly looking for pickups and utility vehicles, because that's about 70 percent of the market in Houston, said Wolf, dealer principal at two stores in the Helfman Motor Sales group.
"In our stores, there's a lot of push for Jeeps, pickup trucks, F-150s, Explorers, Expeditions, Escapes," he said. Some of the most popular Jeep and Ram trims are in short supply, but dealers in other parts of the country are forgoing inventory so that it can go straight to Houston.