Arkansans are doing their part to spur on auto sales in 2012. Through the first half of this year there were 58,494 new auto registrations logged with the Arkansas Office of Motor Vehicles. New car and light truck registrations rose 16.7% from the same period in 2011.
While there a potential 30-day lag between sales and registration dates, numbers have trended higher each month of this year and indicate Arkansas consumers are spending more freely than in past years.
Despite a host of conflicting consumer data, U.S. auto sales continue to be stronger than expected in June according to industry reports released Tuesday (July 3).
Analysts had worried debt concerns in Europe, weaker consumer confidence and lackluster job numbers could weigh down buyer enthusiasm after robust winter and spring selling seasons. Chrysler, Ford and General Motors sold 601,320 vehicles last month, up 14% from June 2011, according to the respective companies.
“A lot of analysts — ourselves included — were cautious going into June with the unemployment rate inching up, consumer confidence dropping and the volatility going on in Europe,” Alec Gutierrez, an analyst at Kelley Blue Book in Irvine, Calif., said in a telephone interview with Bloomberg News. “It’s just a testament to the strength of consumer demand for new vehicles despite all the negative news out there.”
GM sales climbed 16% last month, beating the 7.6% increase that was the average estimate of 11 analysts surveyed by Bloomberg. Deliveries rose 20% for Chrysler and 7.1% for Ford, topping analysts’ average estimates for gains of 18% and 3.7%, respectively. Nissan Motor Co. sales rose 28%, exceeding the 21% average estimate.
"High auto sales volumes in June can be attributed to pent-up demand, some targeted incentive programs, low interest rates and falling gas prices," said Edmunds.com Senior Analyst Michelle Krebs.
The AAA Daily Fuel Gauge Report on Tuesday said the average price for a gallon of unleaded gasoline in the U.S. stood at $3.32 versus $3.59 a month ago.
While sales have slowed a little from the frenetic pace set earlier this spring, analysts say automakers are on track to sell 14.4 million vehicles this year, which looks good given the cloudier economic forecast in the back half of 2012.
"There was great pressure from automakers to close June strong, especially after the unexpectedly weak Memorial Day holiday weekend in May," said Edmunds.com Senior Analyst Jessica Caldwell.
It was the best month for General Motors since September 2008, helped by a 36% increase in fleet sales from a year ago.
“There is a lot of conflicting economic data out there – consumer sentiment somewhat negative, jobs somewhat negative – however we are seeing some decent results in housing, fuel prices are down and the availability of consumer credit is positive,” Kurt McNeil, U.S. vice president of sales operations, said today during GM.’s conference call.
He said the company still sees some headwinds but at the end of the day it’s calling for moderate, gradual economic growth for the balance of 2012.
Automakers across the board posted stronger sales in June, compared to the year-ago period.
By The Numbers
Toyota 277,795, up 60.5%
General Motors 248,750, up 15.5%
Ford 207,759, up 7.7%
Chrysler 144,811, up 20%
American Honda 124,808, up 48.4%
Nissan 92,237, up 28.2%
Hyundai 63,813, up 8%
Kia 51,326, up 14%
Volkswagen 38,170, up 34.2%
Edmunds reports the average age of a vehicle in the U.S. is now 11 years old, which has created some pent-up demand this year. Dealers say a few more incentive offers are also helping to coax buyers off the fence.