The auto industry saw the strongest sales in a decade in August as U.S. consumers continued their exodus from cars into crossovers, sport-utility vehicles and pickup trucks, according to USA Today.
Fueled by low gas prices and high consumer confidence, the auto industry saw a seasonally adjusted rate that, if maintained all year, would amount to the sale of 17.8 million new cars and trucks, Autodata reports.
Without the adjustments, individual automakers encountered mixed results due to comparisons since August had one fewer sales day than the same month a year ago and the three-day Labor Day holiday, traditionally a hot sales weekend for cars, falls entirely in September this year.
General Motors sales fell 0.7% in August, compared to the same month a year earlier, as the automaker favored retail sales over less profitable fleet sales. Fiat Chrysler reported a 1.7% gain, and Ford sales rose 5.6%, Autodata says.
Toyota’s U.S. sales fell by 8.8% for the month. Nissan’s sales fell 0.8% for the month. Honda sales fell 6.7%.
The industry was reaping high prices for the vehicles it sold as well. The average price that consumers actually paid for a new vehicle in August was $33,543, up $1,107, or 3.4%, from last year, reports Kelley Blue Book.
Demand remains robust for trucks instead of cars. Market share for full-size pickup trucks rose from 11.3% a year ago to 13% in August, while market share for SUVs and crossovers rose from 17.5% to 19.5%. That trend is boosting the bottom line for the major automakers because bigger vehicles are more profitable than cars, which shoppers are snubbing. “Cars remain the big challenge,” AutoTrader.com analyst Michelle Krebs said.
“Consumers continue to benefit from low fuel prices, low inflation and low interest rates,” Ford’s senior economist, Yong Yang, said in a conference call. And Nissan Senior Vice President Fred Diaz said: ” I think we continue to see great momentum in the auto industry and the rest of the calendar year.”
But analysts believe sales may be leveling off after several consecutive years of gains.
“Overall, we continue to see the industry in a healthy and steady plateau” for the next two to three years, Barclays analyst Brian Johnson said Thursday in a research note.
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