Editor's note: Earlier versions of this story incorrectly characterized Toyota's victories over Ford in July and August: They were for corporate sales, not brand. An earlier version of this story also incorrectly described the number of selling days in August 2014.
U.S. light-vehicle sales, led by double-digit increases at Chrysler Group and Nissan Motor Corp., rose 6 percent in August, helped by generous Labor Day holiday deals and higher demand for pickups, SUVs and crossovers.
The results easily eclipsed projections that industry sales volume would be flat in comparison to a particularly strong August 2013.
The seasonally adjusted annualized pace of sales -- a key barometer of the industry’s health -- soared to 17.5 million, nearly 1 million units above the 16.6 million estimate from analysts tracked by Bloomberg.
The U.S. auto industry last saw a 17 million light-vehicle SAAR in July 2006 and a 17.5 million SAAR in January 2006.
“Sales continued to gain momentum as the month progressed, and we finished the Labor Day holiday weekend strong,” said Bob Pradzinski, vice president of national sales for Hyundai Motor America. Hyundai posted a 6 percent gain for the month and was among the automakers that tallied August records.
The August results included Tuesday Sept. 2, providing 27 selling days in the month, or one fewer than August 2013. A year earlier, the SAAR came in at 16.1 million and the July SAAR hit 16.5 million – the fifth straight month above the 16 million mark.
Light truck demand rose 9 percent last month, fueling much of the industry’s gains, while car volume edged up 2 percent. In all, 1.59 million vehicles were sold, up from 1.50 million a year earlier.
Chrysler posted a 20 percent increase amid surging sales of the Ram pickup and Jeeps. Nissan advanced 12 percent, with a 15 percent increase for the namesake brand offsetting a 23 percent decline in Infiniti luxury models.
Toyota Motor Corp. had its sixth consecutive monthly gain, up 6 percent overall, on a 16 percent surge in light-truck volume.
Deliveries slipped 1 percent at General Motors, its first dip since February, when its recall crisis began to erupt.
At Ford Motor Co., August deliveries were flat. The Volkswagen brand continued to slump, down 13 percent, but sibling Audi gained 22 percent.
Honda Motor Co.'s sales edged up 0.4 percent and the company said the Honda Accord set an all-time monthly sales record of 51,075, up 33 percent. It was the eighth-straight monthly gain for Accord, which outsold Toyota’s Camry to rank as the best-selling car in the nation during the month.
Overall, deliveries rose 2 percent at the Honda division but fell 9 percent at Acura.
Nissan and Chrysler had been expected to be the only major automakers to tally August increases.
“The industry had its best August in over a decade with sales topping 1.5 million vehicles," Bill Fay, Toyota division general manager, said in a statement.
Toyota Motor Sales edged Ford Motor for the second straight month. And the Toyota brand is now within striking distance of outselling Chevrolet as the nation's second-best selling brand, behind No. 1 Ford. Chevrolet's lead stands at just 2,264 units through August.
Strong season ahead
Kurt McNeil, GM’s U.S. sales chief, said the company sees “a strong fall selling season ahead for GM and the industry.”
GM, which has been dogged by a record wave of recalls this year, said its retail sales fell 4 percent while fleet shipments rose 9 percent. GMC was the only GM brand to post a gain last month, with volume up 10 percent. Sales dropped 1 percent at Chevrolet, 10 percent at Buick and 18 percent at Cadillac.
But trucks proved a bright spot for GM, with volume up 18 percent.
While the Volkswagen brand fell for a 17th straight month, the A3 helped propel sibling Audi to its highest monthly U.S. sales tally in company history: 17,101 vehicles.
At Chrysler, Jeep deliveries rose 49 percent and Ram brand sales climbed 39 percent on a 33 percent jump in Ram pickup volume. Ram pickup deliveries, aided by higher discounts, analysts say, totaled 43,775 for its best August since 2003.
At Ford, sales edged up 0.4 percent at the Ford division and fell 0.6 percent at Lincoln. Ford said it car sales rose 2 percent, utility deliveries increased 5 percent and truck demand slipped 5 percent.
Still, Ford had its best August sales in eight years, with the Fusion sedan and Escape crossover setting records for the month. F-Series pickup demand slipped 4 percent as Ford closed one of two plants that makes the truck last month to begin preparations for a new, aluminum-bodied model. Ford said it also trimmed discounts on its pickups by $650 in August for an average price of about $41,000.
U.S. sales rose 5 percent at Kia, 11 percent at Mazda, and 29 percent at Mitsubishi.
At Subaru, one of the hottest brands in the industry, volume rose 22 percent to 50,246 units on demand for the redesigned Legacy sedan and revamped Outback. It marked the 33rd straight month of gains for Subaru and the first time monthly sales topped 50,000.
But deliveries fell 31 percent at Jaguar, and a 9 percent decline for Land Rover ended the luxury SUV brand's streak of 10 consecutive monthly gains. Volvo sales dropped for the fourth consecutive month.
In the race among luxury brands, Audi surpassed Cadillac last month to rank No. 4 year-to-date behind BMW, Mercedes and Lexus. BMW's lead over Mercedes stood at 5,111 at the end of August.
Chrysler rolls on
It was Chrysler Group’s best August sales since 2002 and the 53rd consecutive month, starting with April 2010, that the company’s U.S. sales have grown year over year.
"This is an impressive streak for a company that was all but left for dead five years ago,” said Edmunds.com senior analyst Jessica Caldwell. “Chrysler's been able to keep it going by diving into the subprime market more aggressively than other automakers and by jumping into the leasing game after it barely stepped onto the playing field while it worked its way out of bankruptcy.”
Overall, Chrysler Group’s light truck volume rose 28 percent while car deliveries skidded 3 percent.
Chrysler and its dealers cited “tremendous Labor Day weekend sales” on top of a “very solid month” for the results.
Sales rose 4 percent at the Chrysler brand but slipped 6 percent at Dodge and 20 percent at Fiat. Chrysler blamed Fiat’s drop on a 500L recall in the U.S. and Canada. Chrysler said it temporarily halted sales of the 500L while it replaces the knee air bags in about 29,500 units.
Chrysler’s average U.S. incentives per vehicle sold last month were estimated at $3,167 by Edmunds.com and $3,476 by TrueCar.com, among the highest of all major automakers.
Deals, deals, deals
Automakers and dealers filled the airwaves with summer, clearance and Labor Day holiday promotions as August progressed.
About 13 percent of all dealer loans in the U.S. were financed at zero percent annual percentage rates in July and August. That's up from 11 percent last summer, and the highest rate since December 2010, Edmunds said.
"Low finance offers have proven to be a critical factor for the auto industry's success in recent months," Edmunds' Caldwell said. "And it's not just the low rates that grab the attention of shoppers; longer terms are also driving down monthly payments."
Edmunds.com says new-vehicle discounts averaged $2,387 last month, up about 2 percent over July but down slightly from August 2013.
TrueCar estimated incentives averaged $2,772 per unit sold in August, up 9 percent from August 2013 but down 2 percent from July.
TrueCar President John Krafcik described August as a tale of two industries. Automakers with a strong, fresh lineup of trucks, crossovers and SUVs “are dancing on the table,” he said in an interview on Tuesday.
But for automakers overly dependent on compact and midsize cars, “it’s tough out there,” Krafcik said.
Through August, U.S. car sales have advanced just 1 percent while light truck deliveries have jumped 9 percent.
Pricing “pressure” in family sedans helped to lower Ford’s average transaction prices by $450 per vehicle to about $31,000 in August, Erich Merkle, the company’s sales analyst, told analysts and reporters today.
“As baby boomers continue to become empty nesters, they seem to naturally flow into these small” SUVs, Merkle said. “Unfortunately, it pulls something from cars, and that’s where you’re seeing some of the weaker pricing.”
Edmunds estimates that Honda spent $2,013 per car on incentives to move the Accord off dealer lots in August, more than three times what it spent a year ago, the Associated Press reported.
Krafcik discounted the recent rise in incentives because the increase has been more than offset by higher transaction prices and profits on many pickups, SUVs and crossovers, producing “a net positive” for most full-line automakers.
“The industry continues to show incredible discipline when it comes to incentives,” Krafcik said. “While we continue to keep close tabs on inventories and incentives, we remain upbeat about auto industry sales, segment mix and profitability.”
TrueCar said the estimated average transaction price for light vehicles in the U.S. was $31,610 in August, up $751, or 2.4 percent, from August 2013 and down $125, or 0.4 percent, from July 2014.
Kelley Blue Book pegged average transaction prices in August at $32,495, driven by strong sales of pickups and fullsize SUVs. That's an increase of $851, or 2.7 percent, from August 2013, but off $16, or 0.1 percent, from July.
Incentive outlays were restrained in the first part of the year but have inched up in recent months.
Analysts say much of the pent-up consumer demand that has driven industry volumes in recent years has been tapped, prompting automakers to sweeten some deals in search of incremental sales.
Brian Johnson, an analyst with Barclays, said Tuesday in a research note that “the pace of sales for the industry has likely plateaued, leading to increased jostling for share.”
Among major automakers, GM, Ford, Honda, Hyundai-Kia and the VW Group have lost U.S. share through August, while Toyota, Chrysler and Nissan have gained ground.
For the full year, analysts estimate U.S. sales of new cars and light trucks will rise to at least 16.3 million, the highest since 2006, when 16.6 million units were sold.
It will also be the fifth straight year U.S. industry sales have advanced. Sales are up 5 percent now through August. Improved household finances and favorable financing conditions are helping drive the gains.
“There’s no question buyers are flocking to dealerships,” Jeff Schuster, an analyst with researcher LMC Automotive in Southfield, Mich., told Bloomberg Wednesday. “We continue to see the market in a very strong position, beating expectations. As the auto industry pulls the economy along with it, we would expect to see this kind of performance for the remainder of the year.”
Bloomberg contributed to this report.