U.S auto sales hit six-year high, December disappoints

Jan 04 2014, 15:52 IST
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U.S auto industry limped to its best year since boom times before 2008 as results came up short in Dec. Reuters U.S auto industry limped to its best year since boom times before 2008 as results came up short in Dec. Reuters
SummaryU.S auto industry limped to its best year since boom times before 2008 as results came up short in Dec.

The U.S. auto industry limped to its best year since the boom times before 2008 as results came up short in December as a late Thanksgiving holiday robbed sales from the year's final month.

The tough sledding in December does not suggest a difficult 2014, however, as several executives and analysts expect auto industry growth to continue outpacing the overall U.S. economy as it has since the recession.

In addition to the late U.S. Thanksgiving holiday weekend, December sales were hurt by snow and ice storms that kept consumers away from dealerships, automakers and analysts said.

"Sales were pulled into November, but also people were more impacted by the compressed shopping season, most of which was in December," Kelley Blue Book senior analyst Karl Brauer said. "People were doing more Christmas shopping than car shopping."

He added that industry-watchers should not be overly concerned by a December that was affected by the timing of a holiday in the previous month. Last month included Jan. 2 due to a quirk in the calendar that affected how automakers typically report monthly sales.

Monthly auto sales are seen as an early indicator of consumer spending.

U.S. industry sales in 2013 finished at 15.6 million vehicles, up 7.6 percent from 2012, while December results inched up 0.3 percent. The annualized sales rate in the final month was 15.4 million vehicles, well below the 16 million expected by economists surveyed by Thomson Reuters.

The timing of Thanksgiving weekend had a greater impact on December sales than in recent years, causing automakers to miss expectations, said Mustafa Mohatarem, General Motors Co's chief economist.

The late December holiday season is generally one of the heaviest sales periods at U.S. auto dealerships. GM, Ford Motor Co and Volkswagen AG all said the weather was less of a negative factor than the timing of the Thanksgiving holiday.

December sales were counted through Thursday, when much of the U.S. Midwest was buried in snow. The storm is now over the U.S. Northeast, but January sales will have time to recover from the current storm as the bulk of sales typically occurs later in the month, said Kurt McNeil, GM vice president of U.S. sales operations.

GM shares ended 3.4 percent lower at $39.57 while Ford shares rose 0.5 percent to close at $15.51 on the New York Stock Exchange on Friday.

BEST YEAR SINCE 2007

For all of 2013, industry sales were 50 percent higher than 2009 when they slumped

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