Conditions for lending are getting more favorable for consumers, and a slew of new or redesigned models have hit market in recent months.
uoyed by strong sales from American automakers, the auto industry appears to be continuing its recovery from the financial collapse of 2008. American automakers showed stronger growth this March than their import counterparts.
The success of the Detroit Three shows that they have come a long way from the dark days that followed the financial meltdown, and the overall success of the other brands shows that the economy is getting better, slowly but surely. However, it's still hard to tell what role more easily available credit plays in these results.
A combination of factors is driving the upward sales trend. Demand remains pent-up following several years of economic recovery after the Great Recession—and speaking of economic recovery, it appears that the overall economy has gotten healthy enough for consumers to open their wallets again. Conditions for lending are getting more favorable for consumers, and a slew of new or redesigned models have hit market in recent months. Finally, as the economy recovers, so does the housing and construction market, driving an increase in pickup and SUV sales.
"A strong first-quarter close and increased consumer confidence continue to position the auto industry as a leader in the economic recovery," Bob Carter, senior vice president of automotive operations for Toyota Motor Sales, said in a press release.
Ford, led by sales of its redesigned-for-2013 Fusion mid-size sedan and Escape compact SUV, was up six percent overall (the Ford division itself was up seven percent). Sales of its popular F-150 pickup were up an impressive 16 percent.
The news wasn't all rosy for Ford, as the struggling Lincoln brand was down 23 percent despite the introduction of a redesigned MKZ mid-size sedan and the launch of a new marketing campaign.
Across town, GM saw mixed, but generally positive, results. Cadillac was up 50 percent, and Buick was up 37 percent. GMC rose 12 percent, but volume-brand Chevy was only up by a half of a percent. Overall, the company was up six percent.
Cars like the Cadillac ATS and Chevrolet Spark did well for GM, as did the Buick Enclave crossover SUV, but the Chevy Malibu and Buick Regal struggled. The mid-size Malibu is a bread-and-butter car for Chevy, so its sales drop hurts GM's volume brand.
Chrysler Group continued a company-record 36-month streak of sales gains with an overall gain of five percent. That was mainly thanks to Ram trucks—or more specifically, their 25 percent increase in sales.
Kia and Hyundai were down slightly, while Nissan and Toyota made only small gains.
Overall, industry analysts are projecting a seasonally-adjusted sales rate of 15.4 million units.
That's not far off from pre-recession levels, but it may be a more reasonable number than what we saw before the recession, when the housing boom and robust economy drove sales to numbers that were likely unsustainable.
No matter how you slice it, the auto industry appears to be healthy once again, and Detroit is leading the way.