DETROIT (Reuters) - U.S. auto sales for September looked set to jump about 13 percent from a year ago, beating analyst estimates because of cheap financing, stronger consumer sentiment and rebounding sales from foreign automakers including Toyota Motor Corp 7203.T.
The annual auto sales pace for September is on track to reach 14.8 million vehicles, Morgan Stanley analysts said, higher than the 14.5 million rate estimated by analysts.
Toyota sales chief Bob Carter said September’s auto sales rate would hit 14.9 million, the industry’s best level since March 2008.
Automakers are offering zero percent financing on some models, and credit is more accessible to subprime, or less-qualified, borrowers. About 80 percent of new vehicle transactions are financed, said R.L. Polk analyst Tom Libby.
“The money is so cheap now,” said Jesse Toprak, TrueCar.com analyst. “Higher resale values and cheap money has been enabling automakers to offer some of the most attractive leasing programs we’ve seen in years.”
The interest rate on a 48-month new car loan was about 3.19 percent last month, down from 4.39 percent in September 2011 and 7.45 percent in May 2009, according to Bankrate.com.
Cheaper loans coupled with improving consumer sentiment have boosted auto sales, particularly since the second quarter. Both General Motors Co GM.N and Ford Motor Co F.N pointed to signs that home prices and housing starts were improving.
Auto sales also continue to benefit from Americans’ growing need to replace aging cars and trucks, which are pushing past the point of repair.
“I think in general with the economy chugging along at about 1.5 percent to 2 percent that we are gradually seeing people come back,” said Ford chief economist Ellen Hughes-Cromwick.
GM sold 210,245 cars and trucks last month, up 1.5 percent from a year earlier. Ford sold 174,976 cars and trucks last month, on par with its results from a year ago.
Toyota said vehicle sales rose 41.5 percent to 171,190 last month, while Honda Motor Co 7267.T sales rose about 31 percent to 117,211.
GM, the largest U.S. automaker, said sales of its mini, small and compact cars nearly doubled last month. Ford’s small car sales rose about 73 percent, while fuel prices rose.
But both automakers said pickup truck sales in September, when those sales typically strengthen, were softer than in years past. Both GM and Ford said trucks made up about 12 percent of sales last month, down from 13 percent in September 2011.
“There has been a fundamental shift of truck to car that we’ve been seeing for the past few years,” said Chevrolet’s sales chief, Don Johnson, adding that September’s results represented a continuation of that trend.
“Consumers, because of the price of fuel, have definitely shifted over the last couple of years to a stronger mix on the car side,” he said.
Ford shares were down 1.8 percent at $9.75 and GM shares were up 2.3 percent at $23.63 in late afternoon trading on Tuesday on the New York Stock Exchange.
The outsized gains from Toyota and Honda reflect their recovery from inventory shortages last year after the March 2011 earthquake in Japan.
Chrysler Group LLC, the smallest U.S. automaker, showed a 12 percent jump in sales to 142,041. Volkswagen of America, the U.S. arm of Volkswagen AG VOWG_p.DE, sales rose 34.4 percent.
Nissan Motor Co’s 7201.T sales fell 1.1 percent to 91,907 vehicles, hurt by higher fuel prices as well as inventory shortages of its Altima midsize sedan, said Al Castignetti, U.S. sales chief for the Nissan brand.
Chrysler, majority-owned by Italy’s Fiat SpA FIA.MI, projected that the sales rate would be 14.9 million for last month, including medium and heavy trucks.
Typically, medium and heavy trucks add around 300,000 vehicles to the sales rate, suggesting a 14.6 million pace for light vehicles for September.
Sales of the company’s new Dodge Dart, introduced earlier this year, continue to rise. Chrysler said it sold 5,235 Darts in September, a 72 percent jump from August.
Reporting by Paul Lienert in Detroit; editing by Gerald E. McCormick, Maureen Bavdek and Matthew Lewis