Retail volume has taken off in the past four months, replacing fleet business as the primary driver of the accelerating U.S. auto sales recovery.
The annual retail selling rate jumped to 10.7 million in December, the fastest pace of the year and 3 million higher than January's rate, according to internal Ford documents obtained by Automotive News.
For the full year, retail gained 9 percent to 9.5 million, while fleet sales increased 18 percent to 2.1 million, Automotive News estimates. That means retail contributed three-quarters of the market's 1.2 million unit gain to 11,590,274 light vehicles.
The retail revival also helps import brands, such as Toyota Motor Sales, which have fewer fleet sales than the Detroit 3. Toyota was the only major U.S. player to lose volume in 2010, which it said resulted from a small retail gain and declining fleet volume.
"The perception is that Toyota has been reeling this year," said Don Esmond, Toyota Motors Sales' vice president of U.S. operations. "But Toyota is the No. 1 retail brand for the third consecutive year."
Early in the year, the smaller fleet segment carried the industry. Retail SAARs were up only four of the first eight months, while sales to commercial, daily rental and government fleets boomed after a recession-forced drought in 2009.
But in the fall, retail SAARs jumped, growing from 9.8 million in September to December's 10.7 million. Even with fleet volume in its seasonal autumn lull, the retail gains were enough to drive total market selling rates above 12 million the entire fourth quarter.
Looking ahead, Ford Motor Co. and General Motors Co. expect both retail and fleet strength in 2011.
"Businesses are coming back into the market a little bit more quickly than the retail consumer," said Don Johnson, GM's U.S. sales boss. "Pent-up demand is still significant. In 2011, we believe this will continue to support the industry's recovery."
Johnson said commercial and daily-rental fleet demand is very strong, but he expects weaker government fleet business because states and cities are strapped.
Ken Czubay, Ford's U.S. sales chief, said the automaker will push its new-generation Focus to expand in the retail small-car segment, which he called "key to our growth strategy" in the United States and abroad.
"The commercial fleet market is back, and we see this continuing in 2011," Czubay said. "This is important because we are the leaders in the commercial fleet market."
Mark Rechtin, Jamie LaReau and Mike Colias contributed to this report