This spring has brought increased sales for the auto industry, according to recent news out of Detroit. May was a good month for car makers despite less than stellar news about the economy. Strong sales are attributed to attractive new models and lower fuel prices. What remains to be seen is how the market will fare in June in light of troubling unemployment numbers for the United States: last week it was reported that job loss has increased for the first time in almost a year.
Auto sales usually reflect the trends occurring in the stock market and the economy in general, as well as consumer confidence level, but last month’s numbers were solid despite dismal stock performances. In fact, May was the worst month in the last two years for the market.
Jesse Toprak is vice president of market intelligence for TrueCar.com. He says, “We should have had a disastrous new vehicle sales month, but consumers are still interested in the new products. This was an anomaly.” Toprak predicts that summer sales may lag just a bit before hitting a late-year upswing after the post-election political dust settles.
The sales totals last month revealed the best May for the car industry since May 2008: 1.3 million cars and trucks. This represents a 26 percent increase from May of 2011. The leaders during this period were Toyota, with a stunning increase of 87 percent over last year, and Honda, with an incredible 48 percent jump in sales over the previous year. The huge increases in sales can be attributed to the effects of the Japan earthquake on factory production; the companies simply had nothing to sell after the disaster. Now they are fully stocked, selling again and quickly regaining their lead over competitors like GM and Hyundai, who profited from the factory shutdowns.
The leading models from these companies were the Toyota Prius, sales of which have tripled in a year, and the Honda Civic with an increase of 80 percent over last May.
Other automakers enjoying record May sales include Chrysler at 30 percent, Volkswagen with a 28 percent gain and Nissan with a very respectable 21 percent boost. Neck and neck at 13 percent were Ford and Hyundai, and General Motors Company gained 11 percent.