U.S. light-vehicle sales -- led by Volkswagen, BMW and Honda -- jumped 9 percent in December, pushing the seasonally adjusted sales rate above 15.3 million for the second consecutive month and helping the industry finish 2012 on a high note.
Automakers sold 14.49 million light vehicles in the U.S. market last year, up 13 percent from 2011, for the highest mark since 2007. It was the third-straight annual gain of at least 10 percent, the first such industry streak since 1973.
"If you want to hang your hat on something that's really improved in our industry, it's the North American auto business," said George Magliano, senior principal economist for IHS Automotive in New York. "It's a shining piece of U.S. manufacturing."
Automakers and analysts expect U.S. sales to continue rebounding in 2013, albeit at at a slower pace, with some forecasts as high as 15.6 million light vehicles.
The National Automobile Dealers Association said Thursday it expects 2013 sales to increase by another 1 million units.
"With last year's tax policy extended and government spending cuts likely in future months, there will be a modest expected decline in purchases of vehicles by the federal and other governments, but not serious damage to the large bulk of consumer purchases of cars and trucks as the economy continues to grow," said Paul Taylor, NADA's chief economist.
December's sales pace of 15.38 million fell just shy of November's 15.56 million, which was the industry's strongest month since January 2008.
Pent-up demand, year-end deals, low-rate financing and easing credit terms are driving the industry's sales.
"People are much more confident about jobs; banks and other credit institutions are much more willing to lend," said Mustafa Mohatarem, GM's chief economist. "You're seeing the customer continue to come back into the marketplace."
Compelling new models
Jesse Toprak, chief market analyst for TrueCar, said the latest car and truck models, often equipped with more features, are also compelling U.S. consumers to consider a new-vehicle purchase after several years of austerity.
Cars sales, helped by robust demand for mid-sized sedans, compacts and mini cars such as the Chevrolet Spark, Smart ForTwo, Fiat 500 and Scion iQ, advanced 18 percent last year, outpacing the 9-percent gain in light-truck volume last year.
Large SUVs, compact pickups and large cars were among the segments that lost the most ground last year.
Chrysler, which analysts had predicted would lose market share in 2012, increased annual sales more than any major automaker other than Toyota and Honda, automakers that rebounded sharply from the 2011 earthquake in Japan.
Volkswagen Group's VW brand and Honda Motor Co. led all automakers last month, outpacing the Detroit 3, Toyota Motor Corp., the Hyundai-Kia Group and Nissan Motor Co.
The VW brand -- helped by newer models such as the mid-sized Passat and compact Jetta -- posted a December U.S. sales gain of 35 percent. VW sales for the year rose 35 percent to more than 438,000 units.
December marked the 16th straight month VW's U.S. sales have climbed 22 percent or more.
Jonathan Browning, CEO of Volkswagen Group of America, said the company's sales growth will taper off in 2013.