Truck Demand Expected to Lift June Auto Sales
U.S. car dealers like Don Kerstetter have every reason to be happy these days as the industry is partying like it’s 2007 — facing demand not seen since before a recession that drove General Motors and Chrysler into bankruptcy.
According to a Reuters report, the owner of Classic Chevrolet Sugar Land outside Houston is on pace for another month of new-car sales above 200, driven by demand for the full-sized pickup trucks that Texans love.
“The month has been good,” he boasted. “It’s picked up over the last week or so in particular. Credit’s generally good in our area.”
Kerstetter is not alone as U.S. auto industry sales in June are expected to rise as much as 8 percent and reach their strongest monthly pace since before the recession that forced the two U.S. automakers to seek bankruptcy protection in 2009.
In May, U.S. auto sales rose more than expected as construction workers and oil drillers bought more pickups to meet growing demand for their services, a trend major automakers expect to continue through the rest of the year.
Most analysts expect a sales pace in June of between 15.5 million and 15.7 million, the high end of which would mark the strongest number since December 2007. The industry is scheduled to report June sales on Tuesday, supplying an early indicator of the U.S. economy’s health.
“We think housing is a driver, but also domestic energy production and also the general economic health of states like Texas, which is a big pickup truck state,” said Barclays analyst Brian Johnson, who expects an annual sales rate in June of 15.6 million vehicles.
Demand for big pickups is so strong that sales this year will top 2 million for the first time since 2007 if the current pace holds, according to Doug Scott, marketing manager for Ford Motor Co.’s top-selling F-150 truck.
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