December Auto Sales Projected to Hit Highest Levels of 2010 The economy may be less robust than most Americans would like, but that didn't stop many of them from hitting car dealer showrooms in December, likely propelling auto sales in the final month of 2010 to the highest levels of the year.

Automakers are believed to have sold about 11.5 million vehicles for the year in the U.S. -- at the low end of analyst expectations, but a welcome 11% improvement from the disastrous 10.4 million units sold in 2009. Most automakers are due to release December sales figures Tuesday.

For the month, sales are forecast to reach 1.13 million units, the highest level of the year and the strongest pace of sales since last year's "cash for clunkers" rebate program, according to venerable car-buying guide Edmunds.com. After adjusting for seasonal variations in purchases, the pace of sales last month translates to an annual rate of 12.34 million, also the highest rate since August 2009, when sales clocked in at 14.15 million pace.

Sales in December are expected to beat November's by about 30%, Edmunds said. November is typically one of the slowest months for car sales, along with January. Of December's total, about 912,000 units, or 81%, were retail sales, indicating that consumers are gradually coming back to showrooms. Earlier in 2010, vehicles sales were more propped up by commercial sales, as rental car companies and corporations replaced aging fleets.

A Good Month for Everyone, Except Toyota


Beyond better sales, automakers also found they didn't need to rely on pricey incentives to get consumers through showroom doors. Though automakers spent heavily to advertise year-end sales, average incentives edged up only $28, or 1.1%, to $2,492 a vehicle in December compared to November, Edmunds said. Further, per-vehicle incentives were down from a year ago by $62, or 2.4%.

Among individual automakers, all of the nation's top six car companies are expected to see sales improvements -- with the exception of recall-saddled Toyota Motor (TM): Edmunds forecasts the world's largest automaker will see its sales fall 12% compared to year ago, to about 165,000 vehicles in December. Still, Toyota's U.S. sales are expected to exceed those in November by about 27.5%.

General Motors (GM), Ford Motor (F) and Chrysler Group are each expected to report higher sales compared to December 2009. GM, the nation's largest automaker, is forecast to sell 230,000 vehicles, up nearly 11% compared to year ago, Edmunds said. Ford likely sold about 187,000 cars, trucks and SUVs, up a modest 5.1% compared to year-ago levels. And Chrysler is believed to have sold nearly 97,000 units, a 12.6% bump up from December 2009.

All of the Big Three automakers are expected to record much higher sales than in November.

Koreans Are Catching Up With Nissan

Rounding out the nation's top six auto manufacturers, Edmunds said it expects Honda Motor (HMC) to increase its sales 6.5% to 114,000 units in December, while those at Nissan Motors (NSANY) likely rose 26% to about 92,300 vehicles. Both Japanese automakers are expected to record lower sales than in November.

Sales at fast-growing Hyundai Motor and Kia Motors are expected to rival those of Nissan, according to a forecast by TrueCar.com, an online pricing guide. TrueCar said that combined the South Korean automakers likely sold 88,000 cars and utility vehicles last month, a staggering 61% increase compared to December 2009. TrueCar's forecast are slightly lower than those of Edmunds when it comes to total sales for the year. TrueCar expects the U.S. auto industry to have sold 11.1 million vehicles during all of 2010.

Looking forward to 2011, Jesse Toprak, senior analyst at TrueCar.com, says he expects continued improvement in the coming year as retail sales of cars and trucks continue to rebound. "Consumer confidence is rising," he says, "and there is a lot of pent-up demand in the market."





Note: December 2010 had 27 selling days, one fewer than December 2009.


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11 Comments

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ultraz2

People are now keeping their cars for a minimum of 15 years. Few want a car payment of 300 to 700 dollars a month. Especially when the novalty wears off in a month when the first car payment comes in and people can't afford to go out and have a good time on their days off because they bought a car and have no spare cash.

January 03 2011 at 2:12 PM Report abuse +1 rate up rate down Reply
1 reply to ultraz2's comment
ultraz2

The USA has 340 million people, and the pie has to be divided up between 15 AUTO COMPANIES, 25 SOON AS INDIA and CHINA enter the US auto market. I'm not impressed.

January 03 2011 at 2:05 PM Report abuse +3 rate up rate down Reply
1 reply to ultraz2's comment
hello stes5

may ford blow the doors off anybody else this year..

January 03 2011 at 2:00 PM Report abuse +2 rate up rate down Reply
donut999

isn't that encouraging--car sales went from disastrous to disastrous + 11%. break out the champagne. december has always been a big month for car sales. 1 reasons, 2 factors. people have it in their heads the dealers have to pay enormous inventory tax so will deal, (this has changed some) but the main one
is volume incentives dealers receive for the overall year (which has not changed), and pecking order on who receives the most marketable cars forward. please quit with the news that is not news. until housing stablizes, we remain in the dumper.

January 03 2011 at 1:46 PM Report abuse +1 rate up rate down Reply
rgkarasiewicz

Don't let these talking heads snow you. Automobile sales are still in the snake pit.

January 03 2011 at 12:47 PM Report abuse rate up rate down Reply
1 reply to rgkarasiewicz's comment
donut999

i don't know what the average age of cars is, but, that is not really a factor. i have 3 cars in family, average age 4 years. somebody else out there must have 3 with an average age of 16 years. whichever trifecta you might own, the newer fleet is not due to be replaced. the owner of the other 3 vintage cars is not able to buy a new car or he would not have 3 16 year old cars. cash for clunkers was a weird kind of success, but we heard much about how it just stole future 09 sales. but, it was not just 09 it stole sales from. it makes little sense to even give much consideration to car sales as an economic barometer. if and when housing stabilizes, we will finally crawl out of the dumper.

January 03 2011 at 1:55 PM Report abuse rate up rate down Reply
kdt34wqx

We'll see how many Fords get sold when gas is $5 per gal.

January 03 2011 at 11:14 AM Report abuse rate up rate down Reply
1 reply to kdt34wqx's comment
emittlesta

What are you talking about? Ford has many vehicles that get better mpg than most Toyotas and Hondas.

January 03 2011 at 11:44 AM Report abuse -1 rate up rate down Reply