US car sales rebound in March

DETROIT: Major automakers on Tuesday reported higher new vehicles sales for March on the back of a strong US economy and big consumer discounts.

Industry sales in March rose 2.5% to 1,653,529, according to Autodata, which said the seasonally adjusted annual rate for the month was a better-than-expected 17.5 million versus 16.8 million a year ago. Analysts polled by Reuters had expected a March SAAR of 16.9 million.

General Motors Co posted a 16% jump in new vehicle sales from the previous March, led by a 14% increase in higher-margin retail sales to consumers. Fiat Chrysler Automobiles NV (FCA) reported a 14% increase and said it saw a 45% spike in sales of its popular Jeep models, giving the brand its best sales month on record.

The strong results for March followed a weak performance in February.

Last year, US auto sales fell 2% after hitting a record high of 17.55 million units in 2016. Sales are expected to fall further in 2018 as interest rates rise and push up monthly car payments. Also, millions of nearly new vehicles will return to the market this year after coming off lease, providing a lower-cost alternative for consumers.

GM notched double-digit sales increases across all brands in March, particularly for its SUV and pickup truck models.

“March was an exceptional month for us,” GM’s US head of sales Kurt McNeil said in a statement. “A growing economy and strong new products helped us execute a very successful plan to conquest customers from other brands.”

While GM said its average transaction price was up $900 in the first quarter, the company’s consumer discounts as a percentage of transaction prices hit 14.5% in March.

The No. 1 U.S. automaker said earlier on Tuesday that it would stop reporting monthly US vehicle sales, saying the 30-day snapshot does not accurately reflect the market and will instead issue quarterly sales.

Other automakers have not yet said whether they will follow suit.

FCA’s retail sales to consumers outstripped those of No. 2 US automaker Ford Motor Co. But FCA also saw a 22% increase in lower-margin fleet sales to rental car companies and government agencies. Over the past year FCA has pursued a policy of cutting fleet sales.

Ford reported a 3.4% increase in overall sales for March, led by an 8.7% rise in fleet sales. Retail sales were up just 0.8% in the month, but Ford said sales of its bestselling F-Series pickup trucks were the best since 2000.

Toyota Motor Corp reported a 3.5% increase in sales in March, with doubledigit increase in SUV and pickup truck sales offsetting a 6.1% decrease in sedan sales.

Sales of the company’s completely revamped flagship Camry sedan dropped 1.1%.

Honda Motor Co Ltd said its March sales rose 3.8%, thanks largely to SUV and pickup truck sales. The automaker’s new Accord sedan saw a 9.9% sales decrease.

US consumers have increasingly shunned passenger cars in favour of more comfortable, higher-margin SUVs and pickup trucks.

Nissan Motor Co Ltd bucked the trend for the month with a 3.6% decline in sales, led by an 8.9% drop in sedan sales.