The US auto industry was on its way to reporting another month of booming sales in October on Tuesday, despite concerns about consumer spending and stagnant wages. Analysts believe that buyers are using the extra savings to buy bigger vehicles loaded with features. Ford Motor Co. and Honda Motor Co. fell short of predictions.
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The burgeoning demand for autos is adding to evidence that the US economy is strengthening as the Federal Reserve prepares to raise interest rates as soon as next month.
Sales are surging as job growth, available credit, and affordable fuel encourage shoppers to replace aging models, especially with sport utility vehicles.
The industry is flourishing amid low gas prices and strong consumer sentiment, posting an annualized selling rate of 18.2 million vehicles in October, according to Autodata. That was the first time that the pace exceeded 18 million in back-to-back months since February 2000.
And General Motors says it expects the industry to surpass a sales record this year. September’s rate was the fastest in more than a decade.
Volkswagen AG (VOWG_p.DE) sales were essentially unchanged, well below the overall industry, as it feels the sting of a diesel emissions scandal.
While modest compared to its peers, the sales increase beat out BMW, the only major automaker to report a sales decline last month. The Japanese auto maker pointed to record sales of its Highlander and RAV4 SUVs. Light-vehicle segment rose 14 percent to 1,46 million, exceeding the average estimate of 1,41 million.
It is imperative to state that this was the best October since 2001, when zero percent financing offers after the September 11 terrorist attacks pushed sales to 1.6 million which is being seen as a huge positive by traders and investors on the street.
Ford Motor Co., No. 2 in the USA auto market by sales, reported it sold 213,938 vehicles last month, a 13 percent rise from the same period past year. GM was up 15.9%, and Ford rose 13.4%. Volkswagen sold only 30,400 vehicles, well below par and Fiat Chrysler Automobiles announced its 67th straight month of year-over-year gains, with 195,545 vehicles in October, 14,7 percent up from 2014.
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Auto makers in the U.S. said car sales rose by a double-digit percentage in October, driven by the month having five weekends and continued strong demand for larger vehicles amid low oil prices.
