Automakers lure buyers drawn by closeouts, financing, new models

DETROIT - Strong pickup demand fueled a big jump in U.S. auto sales last month, an increase that could be felt in Southern Nevada if housing continues to recover.

GM's August U.S. sales rose 10 percent compared with a year earlier, while Ford's rose 13 percent and Chrysler's 14 percent.

Most automakers reported strong gains as Americans flowed into dealer showrooms, drawn by model-year closeouts, low-interest financing and appealing new models. Analysts expect overall sales to rise around 20 percent when companies finish reported later Tuesday.

Pickups, traditionally the top sellers in the U.S., drove much of the business, thanks to a recovering housing market. Sales of Ford's F-Series trucks rose 19 percent, while Chrysler's Ram jumped by the same. GM's pickups, the Chevrolet Silverado and GMC Sierra, among the oldest trucks in the market, saw a 6-percent sales increase.

Scott Huston, manager of Polk Global Automotive in Long Beach, Calif., said pickup sales are still on a one-to-one ratio with auto sales. Gasoline prices would have to reach $5.50 a gallon before pickup truck sales would be affected, he said.

Asian companies and Germany's Volkswagen did well in car sales.

Las Vegas automobile dealer Jim Marsh said Suzuki and Mitsubishi sales "leave something to be desired," but Kia sales have increased two to three times from a year ago.

"One of our problems with Kia is we're short on popular models," Marsh said. "We're down to two models of the Sportage in stock and we should have 20."

The overall increase was due mainly to pent-up demand as consumers and businesses were forced to replace aging cars and pickup trucks, said Yingzi Su, GM's senior economist. The average age of a vehicle on U.S. road is approaching 11 years.

"People have been holding off new purchases for such a long time, since 2008 to now," she said, adding that auto sales are seeing overall improvements even though the economy is growing slowly.

August sales could hit more than 1.2 million vehicles, up around 20 percent from a year earlier, analysts predict. The annual pace could reach 14.6 million units, among the best months of the year.

Toyota now has a full inventory of new cars at dealers and continued its recovery from bad sales last year. Sales grew almost 46 percent.

Honda, which like Toyota saw its factories hobbled by the earthquake in Japan last year, reported a 60 percent increase led by the Civic compact, CR-V small SUV and the Accord midsize sedan. Kia sales rose 21.5 percent from a year earlier, while Hyundai's rose only 4 percent over strong numbers from August of 2011.

Volkswagen continued its staggering growth. Sales jumped 63 percent on strong demand for the Jetta and Passat sedans.

For pickups, a better housing market appeared to be the driver: Builders are getting more permits to start home construction and they have been breaking more ground on projects.

A local dealer agreed.

"As housing gets better, we'll see truck sales get better," said Craig Heinrich, owner of Henderson Chevrolet and Fairway Chevrolet in Las Vegas. "The small roofing guy, the small plumbing contractor ... he needs to replace a truck or two. Then you've got the homeowner who needs a truck to go to Home Depot and haul stuff to the house. Both those pieces are working for us."

Chrysler sold more than 25,000 Rams, aided by discounts. Ford said its F-Series sales rose to 58,201, while the Chevy Silverado trailed at 38,295.

Chrysler also reported a big spike in minivans, with sales of the Dodge Caravan and Chrysler Town & Country each rising more than 30 percent. Chrysler's 300 luxury sedan posted a 65 percent increase.

Review-Journal writer Hubble Smith contributed to this report.