Car shoppers flocked to dealerships in March to buy 1.65 million new SUVs, trucks and cars, as the U.S. auto industry saw new auto sales rise 6.3 percent from the same month last year, according to data from Autodata Corp.
The climb in auto sales was significantly higher than analysts predicted. Autotrader had estimated March sales to increase by 2.6 percent to 1.59 million.
Buyers in March appeared to be "shrugging off" some negatives compared to a year ago such as slightly higher gasoline prices, higher interest rates and stock market volatility, said Charlie Chesbrough, Cox Automotive senior economist, during a sales call. Instead, consumers are purchasing new vehicles based on a strong economy, job creation and low unemployment, he said.
Chesbrough said tax reform also appears to be aiding new vehicle sales.
"March is probably the first full month that folks are going to be getting those tax returns," Chesbrough said. "The new tax reform, which will go into effect in 2018, means that many taxpayers will be saving less this year to pay for those taxes, so there’s a little bit more money in their pockets. And it appears that’s having some positive implications for the vehicle market."
In March, automakers had an extra selling day and a fifth weekend to ratchet up sales compared to March 2017.
And shoppers appeared to continue to opt for sport utilities and trucks — which posted sales gains across the industry — instead of small and midsize sedans. Those segments continue to experience sales declines.
"We had fully expected to report higher year-over-year sales for automakers and that’s pretty much what occurred. What was surprising is General Motors and Fiat Chrysler blew our forecast out of the water," Michelle Krebs, executive analyst for Autotrader, said during a sales call. "Each automaker did a little bit better than we expected, which is why sales are higher than what we thought."
The Detroit automaker’s March sales of 296,341 jumped 15.7 percent from March 2017, as each of its four brands posted sales increases. The boost was led by the near-luxury Buick brand, whose overall sales jumped 28 percent. It included an 82.3-percent bump from the small Encore SUV. GM also saw a big gain with its popular-selling Chevrolet Silverado pickup, as sales increased nearly 24 percent.
Led by a huge 44.7-percent jump in Jeep brand sales that were best-ever for the brand, Fiat Chrysler’s sales rose 13.6 percent to 216,063. Jeep’s monthly sales of 98,382 were led by big increases in Compass, Cherokee and Wrangler sales. The Wrangler posted its best-ever sales for any month at 27,829. Ram Truck, Fiat and Dodge brand sales slipped, while Chrysler and Alfa Romeo brand sales rose from a year ago.
Sales for the Dearborn carmaker hit 244,306, up 3.4 percent. Ford’s car sales were down 8.1 percent, but SUV and truck sales were both up, 7.5 percent and 6.7 percent, respectively. The profitable F-Series alone sold 87,011 last month, up 7 percent. The Lincoln luxury brand’s overall sales fell 2.1 percent as sedan sales continue to slide. But the all-new Navigator SUV’s sales jumped nearly 91 percent and demand remains high for the redesigned utility, with just 14 days of stock available.
Toyota’s sales of 222,782 were up 3.5 percent from March 2017. The Toyota brand saw sales gains of 4.5 percent, while its Lexus luxury division sales fell 3.2 percent. Toyota and Lexus car sales were both down from a year ago. The Japanese automaker was aided by sales of its Tacoma and Tundra pickups and SUVs such as the Highlander.
Sales reached 142,392 in March, up 3.8 percent. Both the Honda and Acura brands posted sales increases and the Honda brand set a new March sales record. Honda was helped with strong sales of the Pilot, up 42.4 percent, and the Odyssey, up 27.8 percent.
Nissan sales fell 3.7 percent from a year ago to 162,535. Both the mainstream Nissan and Infiniti luxury brand had sales declines of 3.6 percent and 4.6 percent, respectively. Despite falling car sales, the Rogue and Armada SUVs had big months. Rogue had a best-ever month and Armada set a March sales record.
Hyundai sales, including the Hyundai brand and Genesis luxury brand, fell more than 11 percent to 61,540. The Tucson SUV had its best-ever month with more than 11,800 sales. Kia meanwhile posted a 2.5-percent sales gain to 50,645. It was led by sales of the Sportage SUV, which had its strongest March sales in history.
The Japanese carmaker continues its growth, posting a 5.9-percent jump in March sales to 58,097. It was Subaru’s best March sales in its history, with Crosstrek and Outback each posting best-ever March sales. Crosstrek sales soared 88.2 percent to top 13,000 for the first time in a month.
Sales reached 32,548 in March for Volkswagen, up 17.8 percent from a year ago. The new Tiguan and Atlas SUVs had strong sales and offset big year-over-year declines in sales of cars such as the Jetta and Passat.