July 02 - Auto sales continue to climb – despite a pick-up in general interest rates - as subsidized loans appeal to owners of aging vehicles and truck sales remain strong. Bobbi Rebell reports.
Auto sales still riding uphill- pushing the industry towards their strongest monthly pace since before the recent recession. Both General Motors and Ford posted stronger-than-expected June sales. GM's were at their highest level for June since 2008. Ford had its best June since 2006. Chrysler's were in line with forecasts- but were its best June total since 2007. It's all about pent up demand -says Edmunds.com's Senior Analyst Jessica Caldwell. SOUNDBITE: JESSICA CALDWELL, SENIOR ANALYST, EDMUNDS.COM (ENGLISH) SAYING: "Cars out there on the road are very old and we are seeing record levels of vehicle ages that are being traded in to buy new cars so I think a lot of people can't wait." Truck sales continue to be strong- thanks to the housing boom. Smaller cars are also appealing to buyers- Ford had its best small car performance in 13 years. Chevy's Cruze sales were up 73 percent. The other big driver: easy credit: SOUNDBITE: JESSICA CALDWELL, SENIOR ANALYST, EDMUNDS.COM (ENGLISH) SAYING: "A lot of the rates are subsidized by the auto companies themselves. So even though the interest rates are getting higher auto companies still want to advertise those low interest rates because that is what is driving them. A lot of people buy on monthly payments, so if you have a low interest rate, monthly payments become a lot friendlier." That easier credit has helped the auto sector hold up better than the broader economy- and bodes well for the rest of the year- even if rates rise.