U.S. sales surge at fastest pace in nearly 7 years

U.S. sales of cars and light trucks surged 9 percent in November to 1.24 million units and rolled off dealership lots at the fastest pace in almost seven years.

The industry's annualized sales rate, adjusted for seasonal factors, rose to 16.4 million last month, up from 15.3 million a year earlier and easily topping analysts' forecasts in the 15.8 million range.

Last month's SAAR was the highest since the 16.8 million mark reached in February 2007 -- 10 months before the start of the recession. It's the second time the SAAR has topped 16 million this year after hitting 16.1 million in August, a sign that the industry's recovery still has plenty of fuel.

"Industry sales in November picked up after Thanksgiving, contributing to the best sales pace of the year," said Bill Fay, Toyota division group vice president and general manager. "Showroom traffic surged over the holiday weekend for Toyota, indicating good momentum we expect to continue through the end of the year and into 2014."

It was the best November since 2003 and just over 84,000 units shy of the industry's best November ever -- 2001, when sales totaled 1.328 million. Industry sales topped 16 million units from 1999 through 2007 before the collapse of 2008-09.

General Motors and Chrysler Group led major automakers with hefty increases in November sales, with pickups and new models such as the Jeep Cherokee driving the gains.

Toyota Motor Corp. and Nissan Motor Co. posted smaller double-digit increases, while Honda Motor Co. volume slipped 0.1 percent from record November 2012 results.

Ford Motor Co. generated an increase of 7 percent and said it scaled back its North American production plans for the first quarter of 2014. Among smaller automakers, Subaru continued its surge while Volkswagen extended its slump.

"Demand was robust for everything from cars to crossovers," Kurt McNeil, head of U.S. sales operations for GM, said in a statement.

GM's deliveries climbed 14 percent on a 19 percent rise in volume to individual customers

Deliveries rose 20 percent at GMC, 13 percent at Chevrolet and Buick, and 11 percent at Cadillac.

For the seventh straight month, Ford sold more than 60,000 F-series pickups. Volume rose 7 percent at the Ford division and 17 percent at Lincoln. It was the second consecutive month of double-digit gains at Lincoln after a string of mostly flat sales.

Ford said it also plans to build 770,000 vehicles in the first quarter of 2014 in North America, a drop of 2 percent from 784,000 vehicles produced in the first quarter of 2013.

A Ford spokesman today cited the need to "match production with demand" for the decline in output.

Ford started November with a 90-days supply of light vehicles, compared with a 72-days supply a year ago. The company said previously it plans to temporarily idle U.S. plants that build the Ford Fusion, Focus and C-Max to trim stockpiles.

Toyota said its U.S. deliveries increased last month by 10 percent to 178,044 units.

At American Honda, sales dropped 2 percent at the Honda division and increased 19 percent at Acura.

"With our second-best-ever November sales, we likely extended our retail sales lead despite very aggressive market actions by competitors in key high volume segments," John Mendel, executive vice president of sales at American Honda, said in a statement. "And we're upping the ante as we approach the close of the year with a significantly updated 2014 Civic going on sale in just a few days."

Healthy demand for the Ram pickup and new Jeep Cherokee propelled Chrysler Group to a 16 percent increase, its 44th consecutive monthly advance.

Cherokee's hot start

After several launch delays, Cherokee deliveries totaled nearly 10,200 units in its first full month on the market.

Jeep, Chrysler Group's second-biggest division after Dodge, has been largely missing from the mid-sized SUV market since the Liberty was discontinued in August 2012.

Ram pickup demand jumped 22 percent to 29,635, its best November since 2003.

Sales rose 30 percent at Jeep, 25 percent at the Ram brand, 12 percent at the Chrysler brand, and 4 percent at Dodge. Deliveries slipped 15 percent at Fiat.

Overall, Chrysler's car sales fell 7 percent and light-truck demand jumped 26 percent.

"Our launch emphasis on Jeep Cherokee quality is now being rewarded with brisk sales," Reid Bigland, head of U.S. sales operations for Chrysler Group, said in a statement.

Hyundai set a November sales record with volume of 56,005 units, a gain of 5 percent. John Krafcik, CEO of Hyundai Motor America, said in a Twitter posting earlier today the gains were led by the Santa Fe, Accent, and Elantra.

Nissan North America sold 106,528 light vehicles last month, a record for November, and up 11 percent from a year earlier.

New and redesigned models spurred a 37 percent rise in sales at Jaguar Land Rover last month.

Land Rover, benefiting from the revamped flagship Range Rover and Evoque, set a November sales record of 4,601 units. Jaguar volume increased 103 percent to 1,446 units.

Andy Goss, group sales operations director for Jaguar and Land Rover, said he expects strong year-end sales to set annual U.S. benchmarks for both brands.

VW skips discount wars

November was another tough month for Volkswagen of America. The VW brand's sales fell 16 percent as sales of the Jetta sedan, Passat sedan and Tiguan crossover all declined, leaving the brand's year-to-date sales 5 percent below last year.

One contributing factor: VW has cut incentives 13 percent since September. That partly reflects the changeover to the 2014 model year, but Volkswagen Group of America CEO Jonathan Browning told reporters today he is determined that VW will not follow the "super aggressive" incentives and the generous financing deals being offered this holiday season.

Subaru, meanwhile, extended its lead over VW in the U.S. sales charts with a 30 percent November increase.

Audi of America sales rose 13 percent on continued strong demand for the Q5 and Q7 crossovers. The luxury brand has sold 141,048 units through November, besting last year's record total of 139,310 units with a month to spare, and putting Audi well on track to beat its volume target of 150,000 units.

U.S. car and light-truck sales for November were projected to climb 5 percent from a strong year-earlier month to 1.2 million units, according to the average of seven analysts' estimates compiled by Bloomberg.

The November volume included deliveries tallied through Monday and five weekend sales periods. Volume was driven by early holiday promotions, attractive financing offers and pent-up demand.

"Sales in November tend to be heavily skewed toward the end of the month because of Black Friday sales events," said Alec Gutierrez, senior analyst for Kelley Blue Book.

TrueCar estimated the industry spent an average of $2,507 per unit on incentives last month, a slight increase over November 2012, but down 2 percent from October 2013.

Post-shutdown lift

Some analysts believe November's figures will reflect a boost from skittish consumers who delayed purchases in October because of the partial U.S. government shutdown.

In November of 2012, sales climbed to their highest annualized rate of the year as consumers replaced vehicles damaged during SuperStorm Sandy along the East Coast. Percentage increases in comparison to that month may be muted as a result.

GM and Ford, locked in a battle over big pickups, each spent more than $3,000, on average, on discounts per model last month, TrueCar said.

Hyundai, Kia and the Volkswagen Group also raised discounts sharply last month compared with November 2012.

"Moderate gasoline prices remain favorable for mix and crossover and full-size pickups are expected to be the strongest-performing segments," Elaine Kwei, an analyst with Jefferies LLC, said in a report Monday. "Auto sales remain one of the strongest areas of consumer spending."

Transaction prices fall

The average transaction price for light vehicles sold in the United States was $30,634 in November 2013, a drop of $198 from November 2012 and down $164 from October 2013. TrueCar said it was the first year-over-year decline in the industry's average transaction price since December 2010, when prices dropped 1.8 percent.

Three automakers -- Chrysler Group, GM and Toyota Motor Corp. -- posted record average transaction prices in November, the company said.

"We feel good about the direction of the economy and our own momentum," GM's McNeil said. "The economy is creating jobs and household wealth. Energy costs are dropping and credit is available and affordable. All of this bodes well for future growth."

Gabe Nelson and Nick Bunkley contributed to this report.