U.S. light-vehicle sales, behind strong truck demand, higher incentives and double-digit gains at Hyundai-Kia, General Motors, FCA US, Ford, Toyota, Nissan and Subaru, rose 14 percent last month to 1.455 million, putting the industry on track to set an annual record for volume in 2015.
The annualized sales rate -- 18.23 million -- came in just above September's 18.17 million pace, the highest since July 2005. It's the first time the annualized pace of sales exceeded 18 million in back-to-back months since February 2000.
GM estimates the six-month moving average for the SAAR now stands at 17.8 million, putting the industry on pace to set a record for light-vehicle deliveries in 2015, easily topping the 17.4 million units recorded in 2000.
“The consumer is driving this,” Jeff Schuster, an analyst for LMC Automotive, told Bloomberg in an interview. “You have a consumer who feels good about the economy, who wants a new vehicle and who has the means to get it with relatively cheap credit. Everything is aligning.”
The SAAR was forecast to reach 17.7 million last month, up sharply from 16.59 million in October 2014, based on the average of 13 estimates in a Bloomberg survey of analysts. The SAAR has now topped 17 million units seven out of ten months this year.
GM notched a 16 percent increase in October volume while touting continued strength in more-profitable sales to individual customers. FCA US stretched its streak of advances to 67 months with a 15 percent jump. Ford Motor Co. and Nissan Motor Co. each gained 13 percent.
Trucks, trucks, trucks
Overall, sales of trucks, crossovers, SUVs, minivans and other light trucks increased 22 percent, aided by low fuel prices, while car demand rose 4 percent last month. While truck demand has been strong all year, rising 12 percent through October, car sales rose in October year over year for only the third month this year.
“Manufacturers with a strong light-truck portfolio -- FCA, Ford, GM, and Toyota -- are maximizing production and availability of these products to take advantage of the appealing environment of low interest rates and gas prices," said Tom Libby, manager of industry analysis at IHS Automotive. "They know this situation won’t last forever.”
GM, behind gains in light-truck demand at Chevrolet, GMC and Cadillac, said retail and fleet volume rose 16 percent last month.
Sales rose 18 percent at Chevrolet and GMC, and 13 percent at Cadillac. Deliveries slipped 0.2 percent at Buick. October was also the first month this year that GM's car sales increased year-over-year.
“The redesign of our full-size trucks and SUVs, and our move into the small crossover and midsize pickup segments were smart bets and our timing couldn’t be better with industry sales at record levels,” said Kurt McNeil, vice president of U.S. sales operations for GM.
Ford Motor was boosted by a 14 percent increase at the Ford division and 13 percent increase in overall retail shipments. Deliveries slipped 4.5 percent at Lincoln, ending six consecutive months of gains.
At FCA, Jeep sales rose 33 percent, Dodge rose 12 percent, Ram rose 2.9 percent and the Chrysler brand and Fiat rose 0.9 percent.
The company’s truck sales jumped 20 percent while car demand slipped 3 percent.
Fiat Chrysler’s incentive per vehicle rose 15 percent last month to $3,546 compared with October 2014, and edged up 1.2 percent from September, TrueCar estimates.
Toyota Motor Corp. said sales surged 13 percent to 204,045 vehicles, including a record October for the Toyota Division that was driven by the Highlander and RAV4 crossovers. For the second straight month, Scion tallied a gain with volume rising 50 percent.
Honda Motor Co. posted a 9 percent gain with sales of 131,651 vehicles, underscored by an October record for the Honda brand. The redesigned Honda Pilot crossover stood out with a 63 percent gain with 12,913 vehicles sold.
The Toyota and Honda results exceeded analysts' predictions.
“October was a huge month for the industry, smashing expectations and continuing its hot streak,” said Bill Fay, group vice president and general manager for the Toyota division.
At Nissan Motor, sales of the namesake brand rose 12 percent, while the Infiniti luxury unit climbed 23 percent.
Industry volume was projected to rise 10 percent to 1.41 million cars and light trucks in October, based on the average of four analysts’ estimates compiled by Bloomberg.
In September, each of the Detroit 3 as well as Japan’s big three automakers advanced at least 12 percent.
At the Volkswagen Group, where volume was forecast to drop 6.4 percent, sales rose 5.8 percent. Deliveries edged up 0.2 percent at the VW brand, despite a sales ban on some diesel models after the company admitted to violating U.S. emissions tests, and 17 percent at Audi.
Subaru streak rolls on
Among other automakers, volume rose 87 percent at Volvo, 35 percent at Mazda, and 20 percent at Subaru and Mitsubishi. Deliveries slipped 3.8 percent at the BMW brand and 23 percent at Mini.
Mazda chalked up its strong sales to easing supply constraints and better build combinations. "We are finally getting to a place where the inventory, and the right inventory, is available for customers when they want it,” a Mazda spokesman said.
Subaru's U.S. sales have now advanced 47 consecutive months year over year.
"We expect to surpass our 2014 annual sales record of 513,693 vehicles before the end of November,” said Thomas J. Doll, president and COO of Subaru of America.
At Jaguar Land Rover, volume surged 76 percent on a 98 percent gain at Land Rover. Jaguar deliveries slipped 1.9 percent and are now off 4.9 percent for the year.