High-ticket SUV, truck sales lead optimism
DETROIT -- Buyers shrugged off economic worries and snapped up SUVs and pickups last month, surprising the auto industry and raising hopes that a bumpy year will end on a high note.
Big trucks typically sell when the housing market and construction industry are strong, gas prices are low and consumer confidence is high. None of those was true in September. The economy remains weak, confidence is shaky and gas cost nearly $1 per gallon more than in September 2010.
But other factors boosted truck sales. Small businesses must eventually replace aging fleets of work trucks. Auto companies offered some good deals to clear out 2011 model trucks and stepped up their marketing. And consumers are learning to live with economic uncertainty.
"We see consumers being more comfortable with buying cars in a continuously volatile environment," said Jesse Toprak, vice president of industry trends and insights for the car pricing site TrueCar.com. "Traditionally, they would have postponed making the purchase decision."
U.S. vehicle sales rose 10 percent from last September, according to Autodata Corp. The sales pace in September was the fastest since April, and automakers expect that pace to stay steady for the rest of this year.
Nearly 54 percent of vehicles sold were trucks and SUVs, the highest percentage this year. That's good news for automakers, which make much bigger profits on those segments. Truck sales at General Motors Co., Chrysler Group LLC and Ford Motor Co. grew in the double digits, outpacing cars. Even Honda Motor Co., which normally gets the bulk of its sales from cars, sold 3,000 more trucks than cars.
A shortage of cars is another reason truck and SUV sales were strong. Analysts expected more Japanese cars to fill showrooms after months of shortages related to March's earthquake and tsunami.
Many buyers were replacing trucks in September because they had to. The average truck on the road is about 10 years old, according to R.L. Polk and Associates.
Promotions helped. GM was offering zero-percent financing for 60 months and $1,000 cash on the 2011 Chevrolet Silverado 1500 pickup.
Paul Ballew, a former GM chief economist who works for Nationwide Insurance, said deals will probably get more generous in the last part of this year. Japanese automakers will have to offer rebates and other incentives to get back market share lost to GM, Hyundai Motor Co. and other competitors. Detroit automakers likely will offer discounts on trucks because of high inventories, he said.
GM's September sales rose 20 percent, led by a 34 percent rise in sales of full-size pickups and SUVs. Chrysler's sales rose 27 percent, while Ford's were up 9 percent.
Other automakers reporting sales included Nissan Motor Co., with sales up 29 percent; Hyundai, with sales up 12 percent; Volkswagen, with sales up 37 percent.Additional Information:
September 2011 U.S. sales figures
Here's a look at what sold best and how that changed from September 2010.
Vehicle September 2011 sales Percent change from Sept. 2010
1. Ford F-Series 54,410 vehicles +14.7
2. Chevrolet Silverado 43,698 +35.8
3. Toyota Camry/Solara 24,851 -19.2
4. Dodge Ram 24,656 +46.0
5. Nissan Altima 24,356 +21.7
6. Ford Escape 20,225 +41.3
7. Honda CR-V 19,604 +9.5
8. Ford Fusion 19,510 +22.6
9. Honda Accord 18,639 -13.8
10. Hyundai Sonata 18,181 -11.9
Source: Autodata Corp.