The US may have forfeited the title of largest auto market to China but Americans remain world-beaters in their desire for that new car smell. Stubbornly high unemployment, poor consumer confidence and even high petrol prices were not enough to keep buyers away from showrooms in October as sales hit the highest level in eight months and rose 9 per cent year-to-date.
Automakers – or at least those not from earthquake-crimped Japan – are appropriately upbeat as this was not one of those suspiciously strong months that either rob sales from the future through incentives or achieve them at the cost of lousy margins. What is more, bona fide retail sales, as opposed to lower quality fleet deals, predominated according to Barclays Capital. More profitable light trucks, a strength of Detroit’s “Big Three”, made up a growing share as well, boosting American carmakers’ collective unit sales by 15 per cent year-on-year. Chrysler and non-Japanese foreign sellers, were far stronger than General Motors and Ford though.
Is the strength sustainable? At a seasonally-adjusted rate of 13.3m a year, sales still remains well below the easy credit heyday of 16-17m and just 800,000 or so ahead of the replacement rate – the point at which America’s car fleet does not get any older.