June auto sales 1.48 million, up 3.9%

Automakers on Wednesday posted mostly improving U.S. vehicle sales for June, capping the best first half in a decade, and predicted an even better finish to the year.

Already accelerating sales will find a new gear in the year's second half, according to several automakers. General Motors Co. plans to release redesigned versions of the Malibu and Camaro. And Ford Motor Co. is reaching full production of its aluminum-bodied F-150 pickup and is promising a second-half sales surge of the top-selling vehicle line in America.

Prices and profits are rising along with auto sales. Relatively low gasoline prices and interest rates continue to drive up sales of sport utility vehicles and pickups. The average vehicle sold for $33,340 last month, up 2.5 percent from a year ago, according to automotive researcher Kelley Blue Book.

"Auto sales continue to push higher and are slated to have one of the strongest years ever," said Mark Williams, an analyst for Kelley Blue Book. "Demand for SUVs and trucks continues to drive the market, which resulted in several top automakers posting higher sales."

Industrywide auto sales rose 3.9 percent to 1.48 million last month, the biggest June since 2006, according to researcher Autodata Corp. The total was just shy of the 1.49 million that analysts had estimated. The annualized sales rate adjusted for seasonal trends was 17.2 million cars and light trucks, Autodata said, matching the average of 11 analyst estimates and keeping the industry on track for its best year in a decade. New products and growing consumer confidence may push the pace even higher the rest of the year.

"We just wrapped up the U.S. auto industry's best six months in a decade," said Kurt McNeil, GM's U.S. vice president of sales operations. "People feel good about their jobs and the direction the economy as a whole is taking, so the second half of the year should be strong, too."

Nissan Motor Co. reported a 13 percent increase that topped the 12 percent average estimate, aided by a 16 percent expansion for its Infiniti premium brand.

Fiat Chrysler said U.S. sales rose 8.2 percent in June as buyers turned to its Jeep sport utility vehicles and Ram trucks, maintaining a streak of gains that spans more than five years. Analysts estimated a 9.9 percent rise.

Honda Motor Co. sales rose 4.2 percent, compared with estimates for a 7.1 percent increase.

Toyota Motor Corp. reported a 4.1 percent increase that exceeded the 3.3 percent gain that analysts had estimated. The company also expects sales to surge in the second half.

"There's a lot of momentum in the market," Bill Fay, Toyota division group vice president, said in a conference call. "Some of the economic data on consumer confidence is very strong, and interest rates remain very affordable."

Ford missed estimates with a 1.5 percent light-vehicle sales gain, compared with projections for a 2.3 percent increase.

Sales of Ford's F-Series pickups fell 8.9 percent last month as the automaker said it continues to build inventory of the new F-150. Sales of Ford's sport utility vehicles jumped 12 percent, with the Explorer gaining 30 percent and the Lincoln Navigator rising 39 percent. Ford's car sales fell 4 percent, led by a 20 percent decline in Taurus deliveries and a 16 percent drop in sales of the compact Focus model.

Ford said it had only half its normal inventory of F-150s on dealer lots in June and that it will not have full supply of its most profitable product until the end of September.

"We're at full production right now, but not full availability," Mark LaNeve, Ford's U.S. sales chief, said of the F-150 during a conference call with analysts and reporters. "That rolls in over the next two to three to four months."

Fiat Chrysler's U.S.-based unit delivered 185,035 vehicles last month. The group has reported 63 straight monthly increases.

"June represented another strong month for our company with sales up 8 percent and our 63rd-consecutive month of year-over-year sales increases," Reid Bigland, Fiat Chrysler's head of U.S. sales, said in a statement.

GM sales fell 3 percent in June, when analysts had anticipated a 3 percent increase, as the largest U.S. automaker slashed deliveries to rental-car companies by 45 percent.

Sales to rental agencies tend to be less profitable, the Detroit-based automaker said in a statement. GM is stopping sales of fleet-only models, such as the Chevrolet Captiva, spokesman Jim Cain said in an email. GM said its retail sales, which exclude discounted sales to bulk buyers, were up 7 percent in the month, with Chevrolet topping Ford.

The shift to SUVs and a preference for fully loaded vehicles drove up vehicle prices last month.

"We're projecting all-time record June transaction prices, which translate to an epic $48 billion month for the industry," TrueCar President John Krafcik said in a statement. More transparency at dealerships and "greater availability of high-demand, high-margin crossover vehicles" are driving that gain, he said.

Business on 07/02/2015

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