U.S. Auto Sales Surge In March
March U.S. auto sales surged to their highest level in more than five years – with several makers reporting all-time records for the month. But the overall increase was smaller than the double-digit gains of recent months, raising concerns about whether the unexpectedly strong pace of the automotive recovery will continue – especially in the light of continuing concerns about the impact of Washington gridlock on the overall economy.
Analysts noted that sales incentives have been declining in recent months, even as average transaction prices – what motorists actually pay after adding options and subtracting discounts – has continued rising. On the other hand, pent-up demand appears to be just one of the positive factors likely to keep momentum going after the industry’s worst downturn since the Great Recession.
"The recovery in U.S. auto sales has continued to outpace the still modest pace of the economic recovery," said Alec Gutierrez, Senior Analyst at Kelley Blue Book. "Consumers have been lured into showrooms by a fresh batch of redesigns such as the Ford Fusion, Honda Accord, and Cadillac ATS; as well as low interest rates and affordable pricing."
On average, reported Gutierrez, consumers paid "just shy of 94 percent of MSRP" for a new vehicle in March, an increase of a half percentage point over March 2012. Separate analysis by tracking firm TrueCar.com saw transaction prices rise to a near-record $31,087, a 1.5 percent increase year-over-year.
Honda led the March surge, its new Accord driving a 7.1 percent overall gain for the maker last month. The new sedan itself delivered a 36.4 percent sales bump.
General Motors came in just slightly behind, with a 6 percent year-over-year jump, the maker’s best March in five years.
Chrysler is another maker riding the revival of the pickup market, the Ram Truck division gaining 24 percent in March on strong demand for the new Ram 1500 full-size truck.