US auto sales end 2012 on strong note

Strong U.S. sales in December capped a remarkable year for the auto industry — especially Japanese brands — and 2013 should be even better.
Associated Press
Jan 4, 2013

Sales of new cars and trucks are expected to total 14.5 million after all carmakers announce figures on Thursday. That is 13 percent better than 2011 and the best performance in five years.

In 2012, Americans had plenty of incentive to buy new cars and trucks. Unemployment eased. Home sales and prices rose. And the average age of a car topped 11 years in the U.S., a record that spurred people to trade in. Banks made that easier by offering low interest rates and greater access to loans, even for those with lousy credit.

"The U.S. light vehicle sales market continues to be a bright spot in the tremulous global environment," said Jeff Schuster, senior vice president of forecasting for LMC Automotive, a Detroit-area industry forecasting firm.

Year-end deals on pickup trucks and the usual round of sparkling holiday ads helped December sales jump 10 percent to more than 1.3 million, auto pricing site TrueCar.com predicted. That would translate to an annual rate of more than 15.6 million, making December the strongest month of 2012.

Toyota, which has recovered from an earthquake and tsunami in Japan that crimped its factories two years ago, said Thursday that sales jumped 27 percent for 2012. December sales were up 9 percent. Unlike 2011, the company had plenty of new cars on dealer lots for most of last year.

Honda sales rose 24 percent for the year. Nissan and Infiniti sales were up nearly 10 percent as the Nissan brand topped 1 million in annual sales for the first time.

Volkswagen led all major automakers with sales up a staggering 35 percent.

Chrysler, the smallest of the Detroit carmakers, had the best year among U.S. companies. Its sales jumped 21 percent for the year and 10 percent in December. Demand was led by the Jeep Grand Cherokee SUV, Ram pickup and Chrysler 300 luxury car.

But full-year sales at Ford and General Motors lagged. GM's rose only 3.7 percent for the year, while Ford edged up 5 percent. For December, GM sales rose 5 percent, while Ford was up 2 percent.

GM executives said the company has the oldest model lineup in the industry, yet it still posted a sales increase and commanded high prices for its cars and trucks. The company plans to refurbish 70 percent of its North American models in the next 18 months and expects to boost sales this year.

North American President Mark Reuss said the company won't give away cars and trucks with discounts like it has in the past, especially when it's in the midst of its biggest product update ever.

"Give us 18 months and you're going to see the whole portfolio turned," said Reuss.

Ford said that even though the fiscal cliff deal raised tax rates on individuals making more than $400,000 and couples making more than $450,000 a year, it doesn't see a huge impact on auto sales.

Its chief economist, Ellen Hughes-Cromwick, said only 2 percent of new-vehicle buyers have income in that upper tax bracket, and they tend to purchase even if there is a change in their after-tax income.

She said Ford is more concerned about an increase in the payroll tax, which is scheduled to bounce up to 6.2 percent this year from 4.2 percent in 2011 and 2012. That amounts to a $1,000 to $1,500 tax increase per household, she said.

"We will look at that closely because it will crimp spending in the months ahead," she said.

December featured year-end deals on GM's big pickup trucks; the company offered discounts of up to $9,000 to help clear growing inventory. The move worked. GM cut its full-size pickup supply by more than 20,000 in December to about 222,000.

Overall, though, analysts said the industry eased up on promotions such as rebates and low-interest financing. Car and truck buyers paid an average of $31,228 per vehicle last month, up 1.8 percent from December 2011.

The year's sales of 14.5 million were far better than the bleak days three years ago when they fell to 10.4 million, a 30-year low as the economy tanked and GM and Chrysler went through bankruptcy protection. But sales still aren't back to the recent peak of around 17 million in 2005.

The Polk auto research firm predicted even stronger U.S. sales for 2013, forecasting 15.3 million as the economy continues to improve. Polk, based in Southfield, Mich., expects 43 new models to be introduced, up 50 percent from last year. New models usually boost sales.

The firm also predicts a rebound in sales of large pickups and midsize cars. All eight of the top manufacturers are strong and introducing new vehicles, and that should bring competition and lower prices in those segments, according to Tom Libby, lead North American analyst for Polk.

But the firm's optimistic forecasts hinge on Washington reaching an agreement on government debt limits and spending cuts.

 

Comments

coasterfan

"2012 was a remarkable year for the auto industry". One would think that even the most ardent anti-Obama folks would have to grudgingly agree that the auto bailout worked. The companies are now solvent, have been paying back their loans, gov't is ceding control of GM and millions of jobs in the auto industry and related industries were saved.

Just read that 1.84 million American jobs were added in 2012. Still room for improvement, but it's certainly a TON better than the 800,000 jobs we were hemorrhaging each MONTH during the final months of the disastrous Bush presidency.

Contango

@ coasterfan:

So when are you puttin' your money where your mouth is and buying a new GM or Chrysler vehicle?

An increasingly debased U.S. currency and the Fed's ZIRP and QE goes a long way in helping to create the appearance of a healthy economy.

Fed Chairman Bernanke said that the Fed was responsible for 2 million jobs being created.

http://www.federalreserve.gov/ne...

All Pres. Obama proved is that crony capitalism works for a time.

Corps like GE enjoyed many goodies in the "fecal cliff" legislation.

http://www.thestreet.com/story/1...

rickross2

I bought one. Sticker price.....$46,000+. lol....couldnt walk straight for a week after that reaming

coasterfan

Contango: Oops. Accidentally posted my reply to this comment under your subsequent comment below. I drive a 2011 GM Equinox. Thanks for asking.

How exactly are you able to post comments all day long on a weekday? Am guessing you must work 3rd shift. Would hope that you aren't retired or unemployed, since that would make you one of Romney's 47%... Love that you mentioned "Crony capitalism" and gave links to conservative/biased articles... Congrats on regurgitating Fox News buzzwords and talking points. Please get back to me when you're able to come up with some original, pertinent thoughts of your own.

Contango

@ coasterfan:

So you "drive," you don't "own." Got it.

The source of the "fecal cliff" goodies article doesn't change the facts.

arnmcrmn

Yeah, for plants like Honda, Kia...etc. lol.

Contango

Best to remember that those new hires in the Detroit auto industry are gettin' a reduced wage.

Ain't the "smoke and mirrors" of Obamanomics fun?

-------------------

"Since Obama's first term, some 2.7 million jobs in the 16-55 year old category have been lost.

The "offset": 4 million jobs for Americans between 55 and 69.

For all those young people graduating from college (with $150,000 in student loans) who are unable to get a job, here is our advice: tell your parents, and grandparents, to retire already.

Oh wait, they can't because Bernanke destroyed their savings. Oops - better luck next time."

http://www.zerohedge.com/news/20...

coasterfan

Contango: Driving a 2011 GM Equinox. Thanks for asking.

Maybe it's just me, but I'll take what you call Obamanomics ANY DAY over what the Republicans have to offer. Not sure which is more inept: GOP economic policies circa 2002-2008 or the GOP congressmen's economic ideas we're currently seeing in the fiscal cliff negotiations. Negotiations probably is the wrong word, since they can't even agree with themselves, much less forge a compromise with Dems. Had to love it when Mitch McConnell filibustered his OWN bill recently...

Re: jobs situation in America. You're certainly entitled to deny that things are continually improving, and have continued to improve since mid-2009. You're also entitled to deny that things were exponentially worse during the last 2 years of the Bush presidency. You're also entitled to blame all the job losses the Bush recession caused onto the guy who inherited the amazing mess that Bush left behind. You're also entitled to ignore all signs of obvious improvement, and continue to cherry pick just those stats that align with your bury-your-head-in-the-sand view.

Because, what else SHOULD we expect from someone who is a part of the Obstructionist Republican Party, whose only goal seems to be to paddle the country in the opposite direction of any positive solutions on anything?

Contango

@ coasterfan:

Would that Equinox be personally or company owned?

Per usual and as someone with a lack of understanding of economics, you place far too much emphasis on who's POTUS as opposed to the actions of the Fed.

Cheap money and easy credit helped to facilitate the financial (credit) crisis of '07-'09.

And all this Admin. and the Fed have done since is to "paper it over" with more cheap money and easy credit.

We've been merely "kicking the can" toward the edge of the "fecal canyon."

Still an Independent, not a Repuke or a Dumbocrat.

Pres. Obama “inherited” nothing, he asked for the job.

coasterfan

Doesn't matter if it's personal or company car. But since you asked, my company has twice as many employees today as it did in 2008, and it's a direct result of the improving economy. No complaints here.

I do understand that the Fed obviously plays a huge role. A dysfunctional Republican president, followed by a dysfunctional Republican-led House have helped prolong a dysfunctional system. The Cheap money and easy credit you're decrying were a direct result of all the deregulation championed by Republicans, which Dems fought vehemently against. Didn't you get the memo?

Ever notice that the people who complain about "kicking the can down the road" didn't complain in 2002-2008 when the can first got its biggest kick downhill by W? Bush increased spending an average of 8% per year. Obama? Less than 2% per year in his first term.

You can call yourself an Independent, but you act anything but. Your rhetoric is 100% pro-conservative and 100% anti-liberal. If it walks like a duck...

Finally, Obama DID ask for the job, but he DID also inherit a mess. Unlike in the Romney World, America has no etch-a-sketch mode. The new president always has to pick up the pieces from the previous POTUS. If that weren't true, the Bush recession would have instantly disappeared in Jan. 2009.

Contango

@ coasterfan:

Got it; it's a company vehicle. Why not go out and spend your own personal money where your mouth is?

The payback from TARP in the Bush yrs. was placed into the Obama yrs. making his percentage of borrowing and spending appear less - smoke and mirrors.

The Fed's ZIRP and QE have been helping to keep this economy on life support.

Sorry I don't fit into a neat mental box for ya. Independent: fiscal conservative, social liberal.

2012 - $16T Federal deficit
2016 - $20T Federal deficit.

Good that you can convince yourself that Pres. Obama is "somehow" a fiscal conservative. :)

The Big Dog's back

Answer the question winnie, where do you work?

Contango

@ Dog:

Self-employed and have been for yrs.

What state do you live in?

Where do you work?

I've asked the above questions numerous times and have NEVER received answers.

Swamp Fox

Goverment Motors aka gmc with the lowest rate of sales, even with the continued government backing, another obbie boondoggler...

KnuckleDragger

-

doppleganger

I don't know if there is any truth to this rumor, but I heard this past week that KBI will be closing in February. I really hope it is not true. Has anyone else heard anything?

KnuckleDragger

Could be. I believe that is when their contract to make wheel bearings for Government Motors expires. GM already made it clear that it will not be renewed. The work is being outsourced to China. Obama's Government Motors, creating jobs...for the Chinese.

Mime Bloggling's picture
Mime Bloggling

http://www.americanthinker.com/b...

January 4, 2013
2012 GM Auto Sales Worse Than Any Bush Year

"These numbers will make your liberal friends go totally crazy: Total U.S. 2012 Auto Sales (all firms combined) are up 9% from 2008, but GM is down 11% in the same period. In plain Yiddish this means the firm that got most of the auto bailout, went the other direction from the industry overall. While the industry as a whole under Obama had one year better than Bush (2012 vs 2008), GM's best year under Obama is worse than the worst year under Bush.

Perhaps now more people will take note that the bailout was about saving over-contracted unions who ran GM finances, not the firm itself, into the ground."

pavedparadise

Go to http://www.staged.com/video?v=Klmb to see what type bailouts the government is providing for the 47% of Americans

jon491

MUST be time to go sign up.

goofus

http://www.nationalreview.com/ar...
Hop and Change isn't working, unemployment rose to 7.8%

KURTje

Love these comments. I'll go to Cappozzis & get new shoes ( that's diagonal from Stull's). Then I'll go to B&B's or Brunswick Grill for dinner. After that I'll go to Big Plus then across the street on Myrtle Ave. to Western Auto. See arcrmen...we were before you. You'll figger it out.