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Led by Prius and compacts, Toyota’s U.S. monthly sales leapt 60% in June

6 July 2012 No Comment

Toyota Motor Corp.’s monthly new car sales in the United States surged 60.3 percent from a year earlier to 177,795 units in June.

The automaker, badly hit by parts supply disruptions stemming from the March 2011 disasters, has been on a full recovery path since earlier this year and secured 87.3 percent growth in May.

With gasoline prices remaining high, the company’s fuel-efficient models, such as Prius hybrids and compact vehicles, saw strong demand in June, Toyota said Tuesday.

Overall, sales of new cars and trucks in the U.S. surged in the reporting month. Automakers sold nearly 1.3 million cars and trucks in June, up 22 percent from last year. Chrysler posted its best June in five years, while sales also soared at Volkswagen, which is on track for its best year in the U.S. since 1973.

The results allayed fears that growth would stall after a strong start to 2012. In spring, sales were on track to reach 14.5 million this year, boosted by mild weather and the postdisaster return of Japanese cars to dealers. But the pace dropped to 13.8 million in May, as the stock market plunged and hiring slowed. In June, there was more bad news about jobs growth and consumer confidence fell for the fourth straight month.

But buyers didn’t go away. Sales in June rose to 14.1 million, according to U.S.-based Autodata Corp. And if sales stay at that rate for the remainder of 2012, it would be the industry’s best year since 2007.

Falling gas prices, cheaper loans and new models such as the Ford Escape and Dodge Dart drew buyers, while the revived housing market lifted sales of pickups. And there was still plenty of demand from people who bought cars in the middle of the last decade and needed to replace them. Annual sales hit a high of 17 million in 2005, and those cars and trucks are now 7 years old.

“If a family in Iowa’s only mode of transportation is on the fritz, they are going to buy a replacement vehicle, even if Spain’s economy is on the brink of collapse,” said Alec Gutierrez, a senior market analyst at Kelley Blue Book.

Automakers also started Independence Day promotions a little earlier than usual, juicing sales at the end of the month.

“In the last two weeks we really went all-out,” said Bill Underriner, who sells Volvo, Buick, Honda and Hyundai vehicles in Billings, Montana.

Colorful ads with holiday deals excited buyers, said Jessica Caldwell, a senior analyst with pricing site Edmunds.com. The Buick Verano small car — one of Underriner’s big sellers last month — is now $239 per month for a two-year lease, or $50 less than usual.

Low interest rates are also making deals like the Verano’s more attractive. The average interest rate on a 60-month new car loan is 4.5 percent, down from 6.98 percent two years ago, according to Bankrate.com. Credit availability is also improving.

“The affordability of cars is probably at an all-time high,” Chrysler Group sales chief Reid Bigland said last week.

Falling gas prices meant buyers were more likely to consider bigger cars and sport utility vehicles in June, not just the small cars that sold well at the beginning of the year. Sales of the Jeep Liberty rose 50 percent and those of the Ford Explorer jumped 35 percent. Gas averaged $3.43 per gallon at the end of June, down 41 cents from the end of March.

Pickup truck sales also improved as home building perked up. Chrysler’s Ram sales rose 12 percent and sales of the Ford F-Series, long the country’s best-selling vehicle, climbed 11 percent.

At Chrysler, sales of the tiny Fiat 500 and Chrysler 300 large sedan more than doubled from a year earlier, helping the company to a 20 percent gain for the month.

General Motors’ sales rose 16 percent, with strong demand for the Chevy Malibu midsize sedan and the Volt electric vehicle.

Ford’s overall sales rose 7 percent. The Escape small SUV posted its best month on record after a new version of the popular vehicle went on sale.

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