Chrysler, Nissan report double-digit sales jumpsChrysler, Volkswagen and Nissan reported robust sales growth last month, a sign that U.S. car and truck sales will remain strong despite worries about the economy.
By: Tom Krisher, AP Auto Writer, Superior Telegram
DETROIT (AP) — Chrysler, Volkswagen and Nissan reported robust sales growth last month, a sign that U.S. car and truck sales will remain strong despite worries about the economy.
All three were above expectations for overall industry growth of about 11 percent as summer clearance deals and low-cost financing trumped buyers' concerns about the economy.
Chrysler, which was first to report numbers on Wednesday, said its sales rose 13 percent to more than 126,000 cars and trucks — its best July in five years. Volkswagen continued its strong growth with sales up 27 percent, while Nissan sales rose 16 percent.
Toyota and Honda also were expected to do well. Analysts predict all three Japanese automakers will report big gains over July of last year, when their supplies were still limited by earthquake damage in Japan.
Good deals on last year's models, low- or no-interest financing and strong trade-in values due to high used-car prices all helped sales, as buyers overlooked negatives such as stagnant hiring and the financial crisis in Europe.
Although deals were available on outgoing 2012 models, average prices for cars and trucks fell only slightly from last month to just over $30,000, according to the TrueCar.com auto pricing site.
Through advertising, auto companies are creating the impression of great deals when they're offering less cash and more low-interest financing because their borrowing costs are so inexpensive, said Jesse Toprak, TrueCar's vice president of market intelligence.
Auto loans are available from banks for just over 3 percent, and car companies are offering zero-percent financing on many models.
TrueCar estimates Volkswagen's incentive spending was up 38 percent last month. Volkswagen was offering zero percent financing for five years on all non-diesel 2012 models. Nissan's spending was also up 22 percent to $3,205, the highest level among the eight largest automakers. Nissan was offering up to $3,400 off the outgoing Altima sedan as the new version hits the market.
At Chrysler, sales of its best-selling Ram pickup rose 17 percent in July as home building increased. Sales of the 200 jumped 43 percent to more than 9,000. It sold nearly 800 Dodge Darts, a key new compact car for the company.
The Chrysler 200, formerly called the Sebring, was revamped last year and got a huge boost after being featured in a 2011 Super Bowl ad featuring Detroit rapper Eminem and a tagline of "Imported from Detroit."
There are signs, though, that Chrysler won't be able to keep up the blistering growth pace from earlier in the year. The company's sales grew more than 30 percent in the first half, and were up more than 40 percent in January and February.
Nissan's sales increase was led by the Infiniti luxury brand, which was up 57 percent. Volkswagen had its best July since 1973, led by the new Passat midsize sedan.