U.S. light-vehicle deliveries, boosted by healthy incentives, America's surging appetite for light trucks and an extra weekend of sales, rose 5.2 percent in June as the auto industry closed out the first half of 2018 on a high.
The seasonally adjusted sales rate for June came in at 17.47 million, up sharply from June 2017’s sale pace of 16.72 million and May’s 16.91 million rate.
“We’re in a good, old-fashioned bull market right now,” Charlie Chesbrough, senior economist for Cox Automotive, told Bloomberg News. “There’s been quite a bit of concern regarding trade and tariffs, but car buyers don’t seem to be worried yet.”
The biggest automakers in the U.S. all posted increases, wrapping up the first half of 2018 on a positive note amid analysts’ forecasts of a rougher ride later this year.
It was the fourth monthly and second-biggest sales advance of the year. Through June, sales have risen 1.9 percent over 2017’s level. Still, most analysts had been projecting the industry will end the year below the 17 million mark for the first time since 2014.
FCA US chalked up an 8 percent gain, its fourth straight monthly advance. General Motors, fueled by incentives averaging more than $5,200 per vehicle, was up an estimated 5.7 percent, ahead of the paces set by American Honda and Toyota Motor Corp. Ford Motor Co. and Nissan Motor Co. eked out small gains.
“The U.S. market is virtually saturated,” said Jeremy Acevedo, manager of industry analysis at Edmunds, before today’s results were released. “Add to that record-high vehicle prices, rising interest rates and historically high numbers of people who owe more than their cars are worth, and the stage is set for a market contraction.”
GM, however, suggests there’s plenty of momentum left.
"Tax reform raised take-home pay, consumer confidence is high and household balance sheets are healthy," said the automaker’s chief economist, Elaine Buckberg. "All of this plus a strong job market makes consumers more willing to commit to major purchases like vehicles."
Company by company
Ford Motor’s U.S. sales rose 1 percent in June behind higher pickup, SUV and crossover demand. Deliveries edged up 1 percent at the Ford brand and 2.8 percent at Lincoln. The company’s retail sales increased 2.9 percent to 156,788 last month while fleet volume dipped 2.3 percent to 73,847.
At Toyota, June volume jumped 3.6 percent. A 13 percent gain in light-truck deliveries offset a 9.2 percent dip in car demand. Sales rose 4.4 percent at the Toyota division but fell 6.2 percent at Lexus.