U.S. auto sales are proving to be a bright spot in the economy after all three major U.S. auto makers reported August sales that were above expectations.
General Motors reported sales of 240,520 units, up 10 percent compared with a year ago. Ford had sales of 197,249 units in August, up 13 percent. And Chrysler reported sales of 148,472 units, a rise of 14 percent from a year earlier.
Manufacturers announced strong sales of smaller cars thanks in part to high fuel prices. Gasoline has risen to record levels this summer, up 21 cents a gallon in the past month.
Automakers also reported strong truck sales. Truck sales correlate closely with the housing market, now that a recovering in housing seems to be taking hold truck sales are also on the upswing.
“The overall market is beating expectations since manufacturers are coming up great new products and customers are willing to buy,” Edmunds senior analyst Michelle Krebs said.
Car loans are also becoming somewhat easier to get, adding another boost to the market.
Sales of Ford’s F-Series trucks rose 19 percent, while Chrysler’s Ram jumped by the same amount. GM’s Chevrolet Silverado, among the oldest trucks in the market, saw a 4-percent sales increase.
Yingzi Su, GM’s senior economist, said the overall increase was due mainly to pent-up demand as consumers and businesses were forced to replace aging cars and pickup trucks. The average age of a vehicle on U.S. road is approaching 11 years.
“People have been holding off new purchases for such a long time, since 2008 to now,” she said, adding that even though the economy is growing slowly, auto sales are seeing overall improvements.
When all automakers finish reporting results later Tuesday, sales could hit more than 1.2 million vehicles for August, up around 20 percent from a year earlier, analysts predict. The annual pace is expected to reach 14.2 million to 14.5 million vehicles, making August the second-best month of the year.
The Associated Press contributed to this report.