The auto industry was hit pretty hard by the recession, and today, more than 5 years after it started, it is still struggling to get out of it, but there are signs that it is on the road to a complete recovery. Car sales have been going strong over the past couple of months, with the strongest figures recorded in November, when many car makers reported that sales have exceeded even the most optimistic expectations. Enticing discounts and promotions over the holiday weekend, along with plenty of new models, as well as a good labor market, are among the most significant factors that made November an excellent month for almost all car makers.
This past month, car sales were so strong, that they led to a 16.5 million annualized selling rate, which is much higher than last year’s rate of 15.3 million, and the fastest rate since February 2007, when it got to 16.8 million. This was the best November in history, when it comes to monthly car sales in the U.S. Virtually all major manufacturers reported substantial gains in November, with General Motors and Chrysler leading the way.
GM saw a 14% increase compared to the same month last year, with 212,060 vehicles sold, resulting in the best November for the company in six years. Cadillac and Buick were its best-selling brands, with 16,172 and 15,072 units sold, respectively. Chrysler sold 16% more cars than last year’s November, or exactly 142,275 vehicles, with Jeep and Ram as the brands that were demanded the most. GM redesigned some of its more in-demand models, improving their efficiency and updating their exterior, which was a major factor that helped boost sales.
Although Ford had the best November in 9 years, it didn’t stop its market share from dropping 0.3 percent, unlike the other two major American car makers, whose market share improved significantly. Be that as it may, Ford’s sales were up, as well, with a 7% increase. They were able to sell 190,449 vehicles, with the majority of them being F-Series trucks, whose sales rose 16 percent. As far as projections for next year are concerned, Ford plans to build almost 15,000 less units than 2013, due to decreased demand.
Japanese giant Toyota also reported favorable November sales numbers, albeit not as good as the American Big Three. They saw a 10% increase, with the Avalon and RAV4 as the biggest gainers. In total, Toyota sold 178,044 vehicles, 19,477 of which were RAV4, which is a 56% improvement over November 2012. Their Japanese counterparts, Honda, on the other hand, were not as successful, and were one of the few companies that didn’t post such significant gains. Their sales were down 0.1% over last year’s November, which was their best November ever.
If you take into account that the average price for a new car grew when compared to the same period last year, these highly favorable sales numbers are a bit of surprise, but it actually makes a lot of sense when you add the generous incentives car makers offered for Black Friday, reduced unemployment rates, somewhat stable gas prices, and the fact that auto loans have become more affordable, with significantly lower interest rates.