U.S. auto sales -- helped by fresh models, easing credit terms and strong demand for crossovers and big pickups – rose 17 percent last month to 819,688 in a fresh sign of the industry's continuing recovery.
On a seasonally adjusted basis, sales hit an annualized rate of 12.6 million units for the month. That is slightly higher than the 12.4 million sales rate that the industry averaged during the fourth quarter of 2010. It also represents the highest January sales volume since 2008.
"We're still not at the oil prices that would tilt the industry," said Paul Ballew, chief economist at Nationwide. "If oil prices don't trip us up, Detroit should have a pretty good year."
General Motors Co.'s January U.S. sales rose 22 percent, helped by new models such as the Chevrolet Cruze and Buick Regal sedan. At Ford Motor Co., sales rose 9 percent, with a 22 percent gain at the Ford division offsetting a 21 percent drop at Lincoln. Toyota Motor Corp.'s sales advanced 17 percent from January 2010, when its recall crisis escalated.
In another indication of the market's growing strength, sales to individual consumers -- so-called retail buyers -- advanced 27 percent at Ford and 36 percent at GM last month. Ford said it was the largest such increase from one January to the next in more than a decade.
At Nissan North America, sales rose 15 percent. Chrysler Group's sales were up 23 percent, led by a 47 percent climb at Jeep.
“We have set the foundation for a year of sales growth with our 16 all-new or significantly revamped models for 2011,” Fred Diaz, Chrysler's lead executive for U.S. sales, said in a statement.
Ford said its results reflected a planned 27 percent decline in sales to daily rental companies, as well as last year's elimination of Mercury and the sale of Volvo.
Fuel economy matters
At the Ford division, car sales rose 10 percent, while truck demand jumped 28 percent. The Fusion and Crown Victoria were the only Ford cars to post higher sales last month compared with January 2010. Demand for the Fiesta subcompact, introduced last summer, reached 4,270 units last month.
“Higher gasoline prices are factoring into vehicle purchase decisions,” said Ken Czubay, Ford's head of U.S. sales and marketing.
Ford said sales of F-Series pickups rose 30 percent, while sales of the newly redesigned Explorer jumped 73 percent.
Sales at Chevrolet, Buick, GMC and Cadillac increased a combined 24 percent last month. They ranged from a 19 percent gain at Chevrolet to a 49 percent increase at Cadillac.
Demand for GM's full-size pickup trucks – Chevrolet Silverado and Avalanche, and GMC Sierra – jumped 28 percent, with retail sales improving 37 percent.
It was GM's fifth consecutive monthly sales gain and biggest since the start of the recession in late 2007. In January 2010, GM sold a combined 1,727 Saab, Hummer, Pontiac and Saturn models -- brands that have been shuttered or sold.
GM said it also benefited from easing credit terms for new car and truck shoppers.
“January was a good month and signaled a solid start to the new year for each of our divisions,” Don Johnson, head of GM's U.S. sales operations, said in a statement. “Our results were driven by gains across the board in all segments, with our newest models leading the way.”
GM said fleet sales dropped 7 percent last month to 39,767 units, with sales to rental fleets down 11 percent during the same period. Sales to commercial customers rose 7 percent for the month, the tenth consecutive month of commercial fleet sales gains.
Fleet sales accounted for 22 percent of all GM sales during the month.
At Toyota, a 23 percent sales gain at the Toyota division was offset by a 17 percent drop at Lexus. The Tundra full-sized pickup posted sales of 6,087 units, up 56 percent over a year ago.
Discounts off from December
J.D. Power and Associates, which gathers sales data from almost 9,000 U.S. car dealerships, issued an unusual update to its monthly sales forecast on the eve of today's sales report. It cautioned that consumers had pulled back from purchases ahead of the crucial end of the month.
Average per-vehicle incentives from U.S. auto makers were essentially flat in January from December, but they jumped 7.5 percent from a year earlier, according to Edmunds.com
Economists say many U.S. consumers remain cautious about spending, and many analysts don't expect a solid rebound until unemployment drops and the housing market recovers.
U.S. light vehicle sales rose 11 percent last year from 27-year lows in 2009, to 11.6 million units. Automakers are counting on similar gains this year.
Reuters contributed to this report