U.S. new-car sales in November continued to run at a blistering pace, putting the auto industry on track to challenge the 17.35 million sales peak reached in 2000.
A spate of Black Friday deals coupled with cheap gasoline and low financing costs helped auto makers overall deliver a 1.4% increase over the same month last year, offsetting what historically is a sluggish sales month. The tally brings the industry this year to 15.82 million vehicles through November.
The results continued an annual sales pace that is tracking to be among the best in U.S. history, and raised industry optimism for a new annual record, barring a string of bad weather or other unexpected woes. Ford Motor Co. said on Tuesday it would spend $1.3 billion, about a fifth of its typical annual capital-expenditure budget, to upgrade a pickup truck plant in Kentucky.
“There is a lot of inventory and auto makers are going to come out with guns blazing,” said Ernie Boch Jr., chief executive of Boch Automotive, a Norwood, Mass., dealership. “Right now, I don’t see any signs of [demand] letting up.”
With gasoline prices nationwide hovering around $2 a gallon, sales of the heavier vehicles that deliver substantially higher profits to auto makers are driving the industry. Nearly 59% of November’s volume was classified as light trucks, according to researcher Autodata Corp., including smaller SUVs.
These light trucks represented three out of every four vehicles sold by Detroit auto makers last month, representing nearly the highest mix of pickup and SUV deliveries as a percentage of sales in history. More than 80% of Fiat Chrysler Automobiles NV sales last month were light trucks.