According to a recent article in The Wall Street Journal, Auto makers on Friday reported a 26% rise in May U.S. sales of new cars and light trucks, shrugging off worries about the American economy despite further signs the recovery is slowing. New car sales jumped last month, bolstered by pent-up demand and improved inventories. Above, a Toyota dealership in Los Angeles last month.
General Motors Co. GM -0.86% and Ford Motor Co. F -4.17% reported sales rose by more than 10%, while Chrysler Group LLC saw a 30% jump. Toyota Motor Corp., TM -2.71% whose sales plunged a year ago after an earthquake hobbled output, reported an 87% increase in sales.
Americans bought 1.33 million new vehicles last month, said researcher Autodata Corp. May's annualized sales pace was 13.8 million vehicles, up from an 11.7 million pace a year ago, but down from April's 14.2 million. It was the first month this year that annualized sales have fallen below 14 million cars and light trucks.
But auto dealers and Autodata said the decline from previous months was largely a result of a change in how the Bureau of Economic Statistics adjusts for seasonal variations. Autodata and other researchers still forecast full-year, new-vehicle sales of about 14.4 million cars and trucks.
May's sales gain came alongside a gloomy jobs report. On Friday the Labor Department said nonfarm payrolls grew by a lackluster 69,000 last month, the smallest gain in a year. April's jobs growth was also revised down to 77,000 from 115,000. A survey of U.S. households found the unemployment rate rose slightly in May to 8.2%.
Auto makers, however, expressed confidence the industry will remain on an upward trajectory. "I don't believe that the employment data in and of itself will have an impact," Ken Czubay, Ford's U.S. marketing and sales chief said in a conference call. "The dealers are telling me that they had excellent traffic over the weekend. There is significant pent-up demand in the marketplace."
Will Churchill, owner of the Frank Kent Motor Co. dealership in Fort Worth, Texas, said his Honda store had a strong month in May, selling about 250 new vehicles compared with 178 a year ago. Still, he said the industry isn't firing on all cylinders, and probably won't have full momentum until after the November presidential election.
"I would say the tide is turning but we still aren't stacking good months on top of good months," Mr. Churchill said. "Our March was one of the best but April was just OK. People just want certainty over who will be the president for the next four years."
GM reported it sold 245,256 vehicles in May, up 11%. Chevrolet sales rose 10%, and both Buick and GMC sales increased 19%, but its Cadillac division saw a decline of 15%. At the end of May, GM dealers had 701,389 vehicles in stock, down 1.6% from the prior month.
Ford's sales grew 12.6%, to 215,699 vehicles, paced by a 30% jump in sales of F-series pickup trucks. Thirty-five percent of the vehicles Ford sold in May went to rental companies and other fleet buyers, the highest mix among the Detroit auto makers.
Chrysler's sales increase, to 150,041 cars and light trucks, was powered by demand for Jeeps and Chrysler-brand vehicles. Sales of its Chrysler 200 and Dodge Avenger midsize cars also jumped, although some of those sales go to rental-car fleets. Figures for Chrysler, majority owned by Fiat SpA, F -4.17% include Fiat brand sales.
A year ago, Toyota and Honda Motor Co. HMC -3.37% were hobbled in the wake of the March 11 earthquake and tsunami that caused them to slow or halt production in Japan and North America for months. That left their U.S. dealers with severe shortages of vehicles, and sales plunged.
Last month, with dealer lots again brimming with cars, Toyota's and Honda's sales rebounded. Toyota sold 202,973 vehicles, only the third time since the 2008 financial crisis that its monthly sales topped 200,000. Honda's sales climbed nearly 48% to 133,997, said Autodata. The gain lifted Toyota's market share by five percentage point from a year earlier, to 15.2%, Autodata said.
Volkswagen AG VOW.XE -3.41% said its U.S. sales rise 28% to 38,657 cars.
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