This story has been updated to include November numbers for Honda, Subaru, Mercedes-Benz, and several other key makers.
Sales of new cars surged at an unexpectedly strong rate for November, exceeding initial forecasts that might have suggested the domestic market was beginning to slow down after a torrid spring and summer.
The November increase was matched by a solid increase in transaction prices as consumers stepped up to purchase the latest models as well as more expensive trucks and utility vehicles.
Automakers may have been among the big winners over a holiday weekend that has traditionally seen shoppers focus on department and electronic star bargains, rather than cars. Aided by their own Black Friday sales promotions, automakers kept showrooms busy – helping boost the seasonally adjusted annual sales rate, or SAAR, to 16.3 million, the best monthly figure this year, and a sign the industry has managed to shrug off a drop in consumer confidence that followed the government shutdown in October.
Chrysler Group posted a 16% sales increase for November, while GM was up 14%. Ford had the smallest gain of the Detroit makers, but still managed to deliver a 7% increase. It was the strongest November for the domestic makers since the years before the 2008 crash of Lehman Brother and the onset of the Great Recession.
Going into the final week of November, preliminary estimates called for a more modest industry increase of perhaps 4% overall, according to forecasts from the likes of J.D. Power and Associates. John Mendel, the top American executive at Honda, had warned that while the industry would be up overall, some makers might be deep in the negative category.
But aided by the Black Friday push, most every maker was able to stay in the black. Toyota, Nissan, Jaguar-Land Rover and Audi also posted double-digit sales increases, while global industry sales leader Toyota posted a 5.9% jump for the month.
“We feel good about the direction of the economy and our own momentum,” said Kurt McNeil, General Motors vice president, U.S. sales operations. “The economy is creating jobs and household wealth. Energy costs are dropping and credit is available and affordable. All of this bodes well for future growth.”
McNeill noted that November demand was strong “for everything from cars to crossovers,” and said he expects to see momentum carry over into 2014 with a wave of well-reviewed new models – five of which are finalists for North American Car and Truck of the Year.”
Ford, the second-largest domestic maker reported setting records with its subcompact Fiesta and midsize Fusion sedans even as it struggled to meet demand for its full-size F-Series pickups.
“We continued to see sales increases across our full family of vehicles – particularly with our passenger cars and utilities in conquest coastal markets – helping us post our best November retail sales performance since 2004,” said John Felice, Ford vice president, U.S. marketing, sales and service.
Chrysler extended its streak of year-over-year sales gains to 44-consecutive months, noted Reid Bigland, head of U.S. Sales for the Chrysler Group. But the maker was particularly pleased to receive a strong pull from consumers for the much-delayed Jeep Cherokee, which, said Bigland, “is off to a terrific start.”
Toyota Motor Sales U.S.A., Inc., reported sales increased 10.1% from November 2012, momentum growing in the final days of the month.
“Industry sales in November picked up after Thanksgiving contributing to the best sales pace of the year,” said Bill Fay, Toyota division group vice president and general manager. “Showroom traffic surged over the holiday weekend for Toyota, indicating good momentum we expect to continue through the end of the year and into 2014,” Fay said.
Nissan said its flagship Nissan Division saw sales climb 10.8%, while its luxury marque Infiniti reported sales increased 10.5%, spurred by strong deliveries of the new Q50 sports sedan and QX60 7-passenger luxury crossover.
(Ford produces 10 millionth Sync-equipped vehicle. For more, Click Here.)
Korean carmaker Hyundai, which has struggled with inventory shortages for much of the year, reported a relatively modest 4.6% sales increase for November.
Audi was among a number of makers to set records for the month, the luxury arm of Volkswagen AG jumping 13% compared to the previous record set last November. It was, in fact, the 35th consecutive month of record sales for Audi, “The story of…strength across our product lineup,” proclaimed Mark Del Rosso, executive vice president and chief operating officer, Audi of America.
(Click Here to see how automakers joined in on Black Friday.)
The German brand’s sibling, Volkswagen, was one of the rare marques in the red, sales sliding 16.3% for the months, and one of the biggest drops in sales yet recorded by the German brand. The results during November also virtually guarantee that VW will finish with a full-year decline.
After delivering a 30% sales increase in November, Subaru appears poised to overtake VW in the U.S. The little Japanese maker’s sales so far this year now stand at 367,000, while VW has sold a total of 373,000 cars, trucks and crossovers – and the German maker could suffer an embarrassing setback if it doesn’t pull off a small miracle in December.
Despite the holiday cheer, a couple of other manufacturers also saw their sales slip in November. American Honda, the umbrella company for Honda and Acura, saw its Acura division register an 18% increase for the month, but sales by the flagship Honda division dropped 2%. Meanwhile, Porsche was essentially flat in November after a series of major gains earlier this year.
The race for the luxury sales crown is, yet again, going down to the wire, though with its 13% increase for November – largely driven by demand for the new CLA model – Mercedes-Benz is current running about 7,400 units ahead of arch-rival BMW after 11 hard-fought months. The Bavarian maker gained 11% last month, not enough to catch its Stuttgart-based rival.
For Jaguar Land Rover, it was the best November since 2005 as sales jumped 37%.
Industry analysts were pleased not only by the overall upturn in November sales but by the $946 jump, or 3%, in Average Transaction Prices – what customers actually paid after factoring in discounts and incentives – compared to October. At an average $32,769, the figure was also up $352, or 1.1%, compared to a year ago, according to Kelley Blue Book a provider of new and used car data.
“Transaction prices continue to rise as consumers look for newly introduced or redesigned models as well as crossovers and pickup trucks,” said Alec Gutierrez, senior analyst for Kelley Blue Book.
Despite the rise in transaction prices, automakers are keeping an eye on inventories, which are expected to fall as carmakers shut plants later this month for the Christmas holidays.
Paul A. Eisenstein contributed to this report.