US auto sales rise again in September

By Tom Krisher

Associated Press

Published: Tuesday, Oct. 2 2012 10:15 a.m. MDT

Schuster expects September sales at an annual rate of 14.5 million, perhaps more if automakers finished the month stronger than expected. Bargain interest rates are largely fueling sales, he said. Some banks and credit unions offer 2 percent financing to people with good credit. That's almost as good as subsidized loans from the automakers' finance companies.

"Not only is it cheap, it's relatively available," Schuster said. "There's no question that's driving buyers."

Also, used-car values have remained high due to tight supplies and strong demand, and that means dealers are paying more for trade-ins.

And there are a bunch of new models coming out, especially in the midsize car category, the most popular segment of the U.S. market. Honda's new Accord and a new Ford Fusion are just hitting showrooms, as is a revamped Chevrolet Malibu. The redesigned Nissan Altima is selling well. A new Toyota Camry, the top-selling car in America, has been in showrooms for only a year.

The new models have ready buyers. People are replacing aging cars they held onto during the 2007-2009 recession, and that's been helping sales all year. The average age of cars and trucks on U.S. roads is near 11 years.

One thing that will be absent from September sales is big discounts from automakers. The average incentive for the month was $2,468, down almost 7 percent from September of last year, according to the TrueCar.com auto pricing site.

Even with uncertainty, there's enough good economic news to help sales, which could reach an annual rate of 15 million this month, according to Morgan Stanley analyst Adam Jonas.

Consumer confidence, one of the biggest factors influencing car-buying, jumped in September to the highest level since February. It was bolstered by a brighter outlook for overall business conditions and hiring.

Checks with dealers found higher floor traffic in mid-month "driven by aggressive lending and marketing activity, particularly for trucks," Jonas wrote in a note to investors.

Sales of 15 million would still fall short of the recent peak of around 17 million in 2005. They bottomed at a 30-year low of 10.4 million during the recession in 2009.

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