Trucks, SUVs power strong auto sales in October
DETROIT (AP) — Fans of SUVs and trucks shoved car buyers aside last month, helping propel sales in October to levels not seen since the start of the year.
The shift was a boon for Detroit's automakers, who posted sizeable increases in sales of pickups like the Chevy Silverado and Dodge Ram, big SUVs like the Ford Explorer and compact models like the Ford Escape.
While sales of cars lost momentum from earlier in the year, some carmakers, including Hyundai and Volkswagen, continue to post impressive numbers and steal away their share of small car sales. Toyota and Honda, for years the category leaders, continued to struggle with earthquake-related shortages of popular models.
U.S. car and truck sales were expected to top 1 million in October, a surprising number for a month when sales are usually slow. Sales are now tracking at a pace similar to the start of this year, before the March earthquake and tsunami cut off supplies. Analysts expect them to stay at that pace through the rest of this year and into next year.
"The economy isn't expected to pick up significantly, and I think that's going to hold us in this pattern of slow growth, stability to slow growth," said Jeff Schuster, senior vice president of forecasting for LMC Automotive.
Pent-up demand helped October sales. Inventories of Japanese cars are getting close to normal. Car shoppers who spent the summer waiting for them to reappear on dealer lots could finally buy them in October.
Honda Motor Co. sales were flat compared to last October, while Toyota Motor Corp. sales fell 8 percent. That still beat the double-digit drops the companies saw over the summer. Sales of the Accord sedan, Honda's best seller, were up 5 percent. Toyota said sales of its subcompact Yaris more than doubled.
Schuster said it could still take a little while for the companies to post year-over-year gains. Besides the lingering effects of the Japan earthquake, Honda has issues in Thailand, where flooding shut down its suppliers. That forced the car company to cut North American production through Nov. 10.
Deals inspired some buyers last month. Auto information site TrueCar.com said Honda raised its incentives by 18 percent to an average of $2,380 per vehicle, while Nissan Motor Co.'s incentives were up 15 percent to $2,917.
"This is the time of the year when consumers are more dialed in to the deals," said Jesse Toprak, TrueCar's vice president of industry trends and insights.
Detroit automakers barely increased their incentive spending in October, but they did shift their marketing to trucks, a typical move during football season.
Trucks buyers paid attention. Ford Motor Co. said sales of its Explorer SUV more than tripled from a year ago, while F-Series truck sales were up 7 percent. Ford's overall sales were up 6 percent from a year ago, even though its car sales fell 8 percent.
Chrysler's sales rose 27 percent. Ram pickup truck sales jumped 21 percent. Sales of the Jeep Compass and Grand Cherokee SUVs were also strong.
General Motors Co.'s sales were up 2 percent. Sales of the Chevrolet Silverado pickup rising 11 percent. And the compact Chevrolt Cruze continues to sale along. Sales were more than double last year, when the car was first introduced.
Toprak said snowy weather on the East Coast may have pulled ahead truck and SUV sales from later in the year. Car sales typically fall this time of year, as buyers gear up for the winter.
But Ken Czubay, Ford's vice president for U.S. sales, said car buyers also are increasingly shifting back to small SUVs and wagons, since gas prices are holding steady. Gas now averages $3.46 per gallon, down from a peak near $4 in May, but still up 64 cents from a year earlier.
Other automakers reporting results Tuesday:
— Nissan said sales were up 18 percent, thanks to big increases for the Altima sedan and Rogue crossover.
— Hyundai Motor Co. said sales rose 23 percent to 545,316, besting its full-year sales record from 2010. Sales of the new Elantra small car were up 37 percent.
— Volkswagen AG said sales rose 40 percent, led by a 52 percent increase for the new Jetta sedan.