Aug. auto sales rate hits 17.53M, best since 2006
Automakers reported a 5.5 percent rise in U.S. sales in August from a year earlier. The seasonally adjusted annualized rate of sales rose to 17.53 million vehicles from 15.94 million a year earlier.
The annualized rate is followed by economists and is calculated using seasonal factors supplied by the U.S. Commerce Department that account for sales from vehicles produced in North America or overseas.
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U.S. August auto sales were the highest for that month in more than a decade, thanks in part to heavy discounting by the manufacturers and a strong Labor Day weekend close, with the industry selling at an annualized pace not seen since early 2006.
All the major manufacturers except General Motors reported year-to-year increases, handily topping analysts' expectations.
August sales rose 5.4 percent from a year ago to 1,583,476 vehicles, according to a Reuters analysis. It is the highest total for the month since the industry sold 1.63 million in August 2003.
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GM held on to the top spot, while Toyota Motor edged Ford Motor for the second straight month.
The lowest gasoline prices in four years helped GM and Chrysler Group, a unit of Fiat SpA, achieve double-digit gains in sales of full-size pickups, which provide the bulk of profit. But sales of Ford's industry-leading F-Series pickups fell as the automaker began the changeover to an all-new aluminum-bodied version.
With nearly all automakers reporting August sales by midday on Wednesday, Morgan Stanley analyst Adam Jonas said the industry's seasonally adjusted annualized sales rate last month was a higher-than-expected 17.3 million vehicles, well above the 16.6 million forecast from analysts polled by Thomson Reuters. It was the highest rate since 17.6 million in January 2006, according to research firm Autodata.
Auto sales are an early indicator of consumer demand as the industry accounts for one-fifth of all U.S. retail spending.
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GM sales fell 1.2 percent to 272,423 vehicles; analysts had expected 272,734. Toyota was up 6.3 percent to 246,100, beating the forecast of 225,973. Ford was up 0.4 percent to 222,174, against the expectation of 216,991.
Chrysler showed a 20 percent gain, to 198,379, compared with a forecast of 185,072, while Nissan Motor was up 11.5 percent to 134,388, versus an expectation of 123,855. Honda Motor climbed 0.4 percent to 167,038, compared with 152,191. Hyundai Group sales, including Kia, rose 5.5 percent to 124,670, compared with a forecast of 117,765.
Incentive spending by the industry last month climbed from a year ago, to an average $2,772 per vehicle, but declined slightly from July, according to research firm TrueCar.com. Virtually all major automakers except Nissan boosted discounts from a year ago.
Research firm Edmunds.com said August sales were helped by a higher percentage of zero-interest dealer-financed loans.
Transaction prices in August averaged $32,495, driven by strong sales of pickups and full-size SUVs, according to research firm Kelley Blue Book.
Beau Boeckmann, president of Galpin Motors in Southern California, said one surprise for dealers is "that SUVs have really taken off again."
Larry Dominique, an executive at TrueCar, said the shift in demand from sedans to SUVs and crossovers is forcing manufacturers to hike discounts on sedans.
—By Reuters.