US car sales for June reached 1.4 million, up by 9.2% year-on-year and the market’s best monthly performance for six years with 7.8 million cars sold across the first half of the year, the best H1 since 2007 and up by 7.7%.
June’s result pushed the ‘annualized rate’ by which the US car industry extrapolates a rolling prediction for car sales in the calendar year to 15.5 million, with the rate for June alone at 15.96 million. The rate calculated across January to May was 15.2 million, in May it was 15.3 million and the rate for June 2012 was 14.4 million. At the nadir of the depression the rate slipped to 9.1 million.
The rise has been attributed to a combination of low interest rates on car loans and increasing demand for pick-up trucks. The average interest rate on a four-year loan is now 2.7% according to Bankrate.com. Between them, Ford, General Motors and Chrysler sold 157,480 full-size pickups in June at an average of $40,361 (£26,399) according to Kelley Blue book.
Toyota, manufacturer of the Hilux pickup and once again declared the world’s most valuable motor brand, saw sales rise by 14% to 195,235 units in June and by 6% in H1 2013 to 1.1 million, including Lexus sales.
Sales of Ford, which has predicted finance profit for the year to match that of 2012, were up by 13% to 1.3 million in the first half of the year and by the same percentage to 235,643 sales for the month, the manufacturer’s best June since 2006.
Chrysler sales were up 8% to 156,686 for the month, also its best June since 2006, and up 9% to 908,332 in H1. The manufacturer has also seen its partnership with Santander Consumer USA now become the largest retail financer of its brand in the US.
Like Ford Credit, GM Financial witnessed a drop-off in performance at the end of 2012. However a 6% boost in June sales to 264,843 and an 8% rise across the first six months of 2013 to 1.4 million units, an increasing amount of which are making up the GM Financial book, should benefit the regenerated captive funder.
Honda sales were up by 10% in June to 136,915 and up by 6% in H1 to 745,578.
Bankers, consumers and rates
On the back of these results, the Standard & Poor’s 500 index – having witnessed its best first half of a year since 1998 – rose by 10 points, to a high of 1,624 on Tuesday morning. The Nasdaq composite was up by four points at 3,439 and the Dow Jones industrial average by 17 points to 14,992.
Meanwhile, the Conference Board Consumer Finance Index compiled by Nielsen rose in May to 74.3 and again in June to now stand at 81.4, its highest point since January 2008.
Low financing terms look set to remain in the US as Federal Reserve Chairman Ben Bernanke has agreed to keep short-term interest rates at their historically low level until the US unemployment rate drops at least another 1.1ppts to 6.5%.
Further data and analysis of car finance in the US will be published in the July issue of Motor Finance magazine.