Economy, Auto

Best US March Auto Sales in 16 Years

Best US March Auto Sales in 16 YearsBest US March Auto Sales in 16 Years

Most major automakers reported US sales gains last month as stronger employment figures and consumer confidence drove the auto industry to its best March in 16 years.

But the sales growth rate appeared to be slowing, as brisk SUV and truck sales barely offset falling car sales. Some automakers had to raise discounts on cars or peddle more of them to rental companies. That could mean better deals for car buyers down the road.

Overall, US sales rose 3.2% to 1.59 million, the best March since 2000, according to Kelley Blue Book. But the growth was only about half of last year's 6% increase. Car sales dropped 6%, while SUVs and trucks were up 11%, according to Autodata Corp.

Ford, Honda, Fiat Chrysler, Nissan, Hyundai and General Motors all reported increases, largely driven by SUVs and trucks. But Toyota sales fell nearly 3% as rising SUV numbers could not overcome car sales that fell almost 10%. Toyota's Camry, the top-selling car in the US, saw sales drop 9% to just under 37,000.

The sales figures, coupled with Friday's announcement that US employers added 215,000 jobs in March, showed that the economy remained healthy despite stock market turmoil. Unemployment rose slightly to 5%, but that was because the number of Americans looking for work has increased.

"It all means that auto sales will continue to lead economic growth," said Mustafa Mohatarem, GM's chief economist. "We expect historically low interest rates, strong employment, rising wages and stable fuel prices to continue for the foreseeable future."

Nissan sales were up 13%, hitting a record for any month in its history. At Fiat Chrysler and Ford, sales rose 8%, while they grew 0.9% at General Motors. Honda reported a 9% increase fueled largely by the all-new Civic compact, and SUVs. Hyundai sales rose just 0.4%, but it was enough to set a record for monthly sales.

Ford and Fiat Chrysler posted their best March numbers in a decade. General Motors, which has been cutting sales to rental car companies, said its retail sales to individual buyers rose 6%.

Some analysts said there were troubling signs for automakers beneath the numbers. Last month had two more selling days than a year ago and spending on discounts is on the rise.

The increase comes mainly because automakers are having trouble selling cars as the US market shifts to trucks and SUVs, according to J.D. Power and Associates. Discounted cars can push down used car values so buyers have less to trade in, said Thomas King, a J.D. Power vice president.

Mark LaNeve, Ford's US sales chief, said he's seeing increased car discounts because of the market shift toward SUVs and trucks, but "not anything that would be alarming".