U.S. May auto sales seen shaking off disappointing April
By Ben Klayman
DETROIT (Reuters) - The U.S. auto industry is expected to report sales growth of more than 6 percent in May, shaking off disappointing results in the previous month as consumers still headed to dealer lots to buy new cars and trucks.
Rising consumer spending and a recovering housing market have buoyed demand for autos even as aging cars and trucks have forced many Americans into the market for replacement vehicles, analysts and industry executives said. Analysts polled by Thomson Reuters expect an annual sales rate in May of 15.1 million vehicles.
That would be a welcome rebound from April when the rate disappointed, coming in at 14.9 million vehicles due to lackluster results from some foreign automakers and weaker sales to commercial customers. The annual sales rate had topped 15 million each month since November before falling short in April.
"I'm less concerned about April being indicative of any sort of downturn," Gabelli & Co auto analyst Brian Sponheimer said. "There's still a great deal of pent-up demand that needs to work its way through the system. On the whole, we're still looking at another two years of outperformance for the auto industry as it relates to the broader economy."
Auto sales each month are an early indicator of economic health. The industry is in the midst of its fourth year of recovery from an economic downturn that pushed General Motors Co (GM.N: Quote) and Chrysler into bankruptcy in 2009.
On Wednesday, Ford executives said May was looking good and predicted the industry's annual sales rate would finish at about 15.2 million vehicles.
Automakers are scheduled to report May sales on Monday.
Strong dealer showroom traffic has the industry expecting overall sales reaching as much as 15.5 million vehicles this year, up from 14.5 million last year. Continued...