While U.S. economic news is hardly good, somehow auto sales again proved to be a bright spot in October.
As the housing sector remains on a downward slide in much of the country, manufacturing growth slowed, and economists wondered how Greece's nearing economic meltdown will affect the global economy, Americans are buying cars at a surprisingly hot rate. At early tallies, industry-wide auto sales this past month looked about ten percent higher than last October.
General Motors [NYSE: GM] and Ford Motor Co. [NYSE: F] both reported modest gains year-over-year, but it was Chrysler that really picked up the pace in October. Sales of the Chrysler brand itself were up 28 percent, compared to last October, while company-wide, gains were almost as good, at 27 percent.
Volkswagen, which just started assembling 2012 Passat models in Tennessee, reported sales up about 40 percent, and Hyundai sales were up 23 percent, both compared to last October. And Kia continued to surge, with its calendar-year-to-date sales now more than 35 percent higher than this time in 2010. Mercedes-Benz, Audi, and Volvo also showed especially strong gains from last October.
The continued growth for those two Korean brands is all the more impressive when considering that Incentives for Hyundai and Kia, among major automakers, remained the lowest in the business—about $1,145 per vehicle, and down 23 percent from last year, according to TrueCar.com. Chrysler has managed to roll back some of its incentives, but it still gives out the most per vehicle; Honda, Nissan, and Toyota are also offering higher incentives than last year.
Honda revealed this past week that production of some of its models will be affected by the flooding in Thailand; furthermore, we reported today, it might also affect the rollout of a redesigned 2012 Honda CR-V. This comes on the heels of a dragging recovery from supply interruptions resulting from the catastrophic March earthquake in Japan.
Analyists for months have suggested that the auto industry is bucking the general economic trends because shell-shocked Americans had simply deferred vehicle purchases as long as they could.
That theory is beginning to be replaced with real optimism that this news might indicate that the economy is bouncing back on 'Main Street' terms. There are some signs that more Americans are finding jobs—and a number of economists expect good news in the next federal jobs figures for October, due this Friday. As a hint of that, the polling firm Gallup found in mid-October that unemployment was around 8.3 percent, down from 9.2 in late August and 10.0 a year ago. Gallup also noticed a significant drop in 'underemployment'—those working part-time who want to be full-time.
Read on for more details from the individual automakers:
General Motors: Chevrolet sales were up 6 percent, but slower sales at GMC, Buick, and Cadillac saw the automaker's figure up 2 percent versus last October. Retail deliveries were up a more impressive three percent. The automaker attributed the launch of the new Chevrolet Sonic and Buick LaCrosse eAssist, as well as strong sales of the Chevy Equinox and Camaro, plus the Cadillac SRX, Buick Regal, and GMC Terrain. More than 1,100 Chevy Volt models were delivered this past month.
Ford: Compared to last October, Ford Motor Company sales were up 6 percent versus last year. Leading that surge were sales of the company's utility vehicles, like the Explorer and Escape. And even though the Escape is about to be replaced, sales of the aged crossover were up 31 percent versus last year and at a record 206,696 sold so far this year. Fiesta, Focus, and Fusion were also up versus last October, while Ford-brand trucks were up a significant 8 percent from year-ago levels.
Chrysler: October sales were up 27 percent compared to last October, and Chrysler says it was the best October since 2007. The redesigned Compass sold 5,179 units, and the refreshed Jeep Wrangler moved 9,892 units. The Chrysler brand itself was up 28 percent, buoyed by the Chrysler 200, and Ram-truck sales were up 21 percent. So far, 2011 CYTD sales are up 23 percent through October, compared to the same period in 2010.