Auto sales surge to best pace since 2005

DETROIT – New car and truck sales exceeded already lofty expectations in May as easy credit, longer loans and Memorial Day weekend promotions attracted strong showroom traffic.

The industry’s annual selling rate reached 17.8 million, the strongest monthly pace since July 2005, according to Autodata Corp.

It is an eye-popping level after a dramatic decade that saw a deep recession and the bankruptcies of General Motors and Chrysler before the long road back to recovery.

“We’re expecting this year to be the sixth year over year of growth,” said Eric Lyman, Truecar vice president of industry insights. “This is the first time we’ll see six consecutive years of growth ever in the industry or at least back to when our data set begins in 1931.”

Automotive News reported that it did happen in the 1920s.

With continued low gasoline prices, Americans are continuing to migrate to pickup trucks, SUVs and larger crossover vehicles, which is pushing up the selling prices. Kelley Blue Book reported that the average new vehicle sold in May for $33,363, down slightly from April, but 4.3 percent higher than May 2014.

Automakers with a strong light truck lineup were rewarded.

Fiat Chrysler Automobiles sales rose 4 percent from a year earlier, General Motors was up 3 percent while Ford saw its sales fall 1 percent because it did not have enough new trucks in showrooms across the country.

Car-heavy automakers continue to be affected by the surge to trucks and crossovers. Toyota’s sales slipped 0.3 percent as a 10 percent increase at its Lexus luxury brand nearly offset a 1.6 percent decline at Toyota division. Honda saw sales increase 1 percent and Nissan reported a drop of almost 1 percent, which would have been worse if not for record sales of its smaller lineup of trucks and crossovers. Hyundai was down 10 percent, while sister Kia was up 4 percent.

Volkswagen’s U.S. sales rose 8 percent, helped by a strong start of its new Golf family of small vehicles, which were up 252 percent from May 2014.

GMC had the strongest sales month among General Motors’ four brands with a gain of almost 13 percent. Sales of the GMC Acadia were up 67 percent, while sister model Buick Enclave was up 23 percent and Chevrolet Traverse sales nudged up 2 percent as the midsize crossover vehicles continues to attract more buyers.