Sales were led by double-digit percentage increases for the Detroit Three automakers and the Japanese giants on a year-on-year basis. In the same month last year, U.S. consumers bought 909,127 cars and light trucks, a total that itself represented an 11 percent rise over the year before.
While it is still too early to say auto sales have fully recovered from the so-called Great Recession -- or even that the U.S. economy has recovered from it -- buyers are flocking to dealerships in numbers that haven’t been seen in years.
General Motors Co. (NYSE:GM), the largest automaker based in the U.S., estimated that the industry's seasonally adjusted annual rate, or SAAR, of vehicle sales was 15.3 million last month. The SAAR is a running estimate used as a key metric to gauge how well the auto industry is faring compared with annual estimates of total sales, which for 2013 range between 15 million and 15.5 million units. If GM's estimates are on the money, then auto sales in January are in line with the forecast of higher sales for 2013 in comparison with last year, when 14.4 million vehicles were sold in the U.S.
According to the National Automobile Dealers Association, or NADA, reasons for the positive momentum in sales include easier access to credit, low interest rates, a lower unemployment rate, and higher home prices. Also, consumers drove their clunkers through the 2008-20009 recession and the ensuing years of uncertainty, so there are fewer used-car options on the one hand and pent-up demand for that new car smell on the other hand. Barring some unexpected apocalypse, this momentum will continue.
“It’s been a generally positive attitude [among new-car dealers]. It’s been extremely cold in some parts of the country, and so the expectation would be that some people will stay indoors during January, but you’ll see them in February or March,” said Paul C. Taylor, chief economist at NADA in Tysons Corner, Va. “Another thing that will be helping this month and will help next month are the checks sent to people who lost cars to flooding and storm damage from Hurricane Sandy. January and February will be two of the main months benefiting from replacement sales in the areas affected by the storm.”
Consumers spent more on their cars in January this year, compared with the same month last year. The average vehicle transaction price in 2013 was $30,812, an increase of $300 over last year, according to the Santa Monica, Calif.-based auto-pricing and information website TrueCar.com.
“Transaction prices continue to be at record levels as attractive leases and low-cost financing options are enabling consumers to afford more expensive vehicles with rich content while keeping their monthly payments at about the same levels,” said TrueCar senior analyst Jesse Toprak.
New-car consumers buying Volkswagens paid the highest average transaction price, $33,479, while those purchasing Hyundais paid the lowest, $22,471.
Here’s a rundown of the top auto sellers and how they fared last month:
General Motors Co. (NYSE:GM) sold the highest number of units at 194,699, led by an 11 percent rise in Chevrolet sedans and strong demand for the company’s line of full-size pickup trucks. Total sales grew 16 percent compared with last year.
Ford Motor Co. (NYSE:F) came in second with 166,501 units, a 22 percent increase from last year as consumers flocked to the company’s line of sedans -- especially the Ford Fusion -- as well as the Escape and Explorer SUVs.
Chrysler LLC, a subsidiary of the Italian Fiat SpA (BIT:F), reported its best January since 2008, before the recession that scuttled auto sales. Like GM, Chrysler saw total sales rise 16 percent, to 117,731 units. Sales of the Ram pickup truck, the company’s top seller, rose 14 percent. Jeep was the only brand group that saw sales shrink, by 4 percent.
Toyota Motor Sales U.S.A. Inc., a subsidiary of the Japanese Toyota Motor Corp. (NYSE:TM), reported selling 157,725 units last month, a 26.6 percent rise from last year, with robust demand for the 2013 Avalon sedan and 2013 RAV4 crossover.
American Honda Motor Co. Inc., a subsidiary of the Japanese Honda Motor Co. Ltd. (NYSE:HMC), came in with 93,626 units, a 12.8 percent rise led by high demand for the new Accord, which represents one out of every four units the U.S. subsidiary sold last month. Honda Pilot crossover sales rose 16 percent in January, while Honda’s Acura luxury line also saw double-digit percentage growth.
Nissan North America Inc., a subsidiary of the Japanese Nissan Motor Co. Ltd. (TYO:7201), saw 80,919 units roll off dealer lots last month, a 2 percent rise fueled largely by sales of the Altima sedan, which represented more than one-quarter of all unit sales. The Pathfinder saw sales more than triple to 6,281 units on the back of the November rollout of the 2013 model.
Hyundai Motor America, a subsidiary of the Korean Hyundai Motor Co. (KRX:005380), sold 80,015 vehicles, a 2 percent rise over last year. Top sellers were the Sonata sedan and Elantra compact.
Volkswagen Group of America Inc., a subsidiary of the German Volkswagen AG (ETR:VOW), sold 42,603 units in January, a 9 percent rise on the back of demand for the Passat sedan, whose sales growth topped 40 percent.
J.D. Power and Associates estimated that January new-vehicle retail sales would be 812,600 units, while the above figures include fleet sales, such as purchases by governments or rental agencies. The top 17 companies that sell cars in the U.S. moved 1,043,192 units in all last month.