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Sales of new cars and trucks in August were a bright spot in the economic greige, continuing a year-long trend that analysts say will only diminish mildly by year's end.
All the Detroit-based automakers reported double-digit sales increases for the month, joined by ebullient numbers at Toyota, Volkswagen, and Kia.
Sales trended up noticeably from July's strong numbers. J.D. Power and Associates had forecast that August would deliver a retail-level seasonally adjusted annual rate (SAAR) forecast of 12.3 million units, and an overall SAAR of 14.5 million units, and the final numbers could exceed those projections.
The enthusiasm in dealer showrooms could be a result of sell-downs in advance of the new model year, which brings some important new vehicles, like the Ford Fusion and Escape, Chevy Malibu, and Honda Accord. Dealers are spending less to move the 2012 models--$106 less per vehicle, Power says--and so far, the automakers haven't spooled up production to unsustainable levels, says John Humphrey, senior vice president of global automotive operations at J.D. Power and Associates.
"Going forward," he says, "this discipline will be tested as demand looks to cool somewhat through the balance of the year."
The slowdown is expected to arrive at the traditional point late in the season, when weather dampens shopping. But it could also be aggravated by continued economic difficulties. New unemployment numbers are due this week, and early indications are for no improvement over July's 8.3 percent. Likewise, while consumer confidence rose unexpectedly in July, so did gas prices, which reached an all-time Labor Day weekend peak.
For the year, analysts expect sales to remain healthy. LMC Automotive has cut its forecast somewhat, and now says total light-vehicle sales for 2012 will come in at 14.3 million units, with retail sales forecast at 11.4 million units.
"The overall picture in 2012 remains positive," said Jeff Schuster, senior vice president of forecasting at LMC Automotive.
LMC's figures are at the middle of the spectrum forecast by the automakers themselves, with Chrysler predicting 14 million units, and GM slightly more pessimistic at between 14 and 14.5 million units.
Which automakers are feeling the power of August sales, and which are still weak? These are the August 2012 figures, as reported by the automakers: