Low gas prices helped drive December U.S. sales, and while the pace of growth may slow, the sector looks healthy heading into 2015. Bobbi Rebell reports.
It's a great time to be in the auto business. U.S. average gasoline prices are 34 percent lower than a year ago, and in a lot of places are even below $2 per gallon. That's meant sales for auto makers in December. GM logging a 19 percent gain, Fiat Chrysler sales were up 20 percent, while Ford increased just one percent. With cheap gas to fuel them, Pickup trucks and SUVs were driving a lot of the December gains. Reuters' Transportation Editor Joe White: SOUNDBITE: JOE WHITE, REUTERS TRANSPORTATION EDITOR (ENGLISH) SAYING: "Overall the industry had a good month. December is one of the strongest months if not the strongest month of the year. Everybody at these companies seems to be pretty happy with how 2014 turned out". Full year sales for 2014 expected to come in around 16.5 million. vehicles. TrueCar's Eric Lyman: SOUNDBITE: ERIC LYMAN, VICE PRESIDENT OF INDUSTRY INSIGHTS, TRUECAR (ENGLISH) SAYING: "We expect this to continue. We are actually forecasting sales in 2015 to get up to 17 million, which we haven't seen since the mid- 2000's before the recession." And the rising demand has allowed automakers to boost prices for their vehicles. The average transaction price for a new vehicle sold in the U.S. market in December was a record $34,367, up 2.5 percent from a year ago, according to Kelley Blue Book. And there's a lot to keep the momentum going: SOUNDBITE: ERIC LYMAN, VICE PRESIDENT OF INDUSTRY INSIGHTS, TRUECAR (ENGLISH) SAYING: "We are still seeing the influx of the millenials coming into the car buying age and creating some demand there. The economy is still recovering. We are seeing consumer confidence at its highest level in 8 years and financing still remains very affordable for a number of American consumers." Lyman does point out that because consumers have been flocking to big vehicles given the cheap gas, that has taken away interest in more fuel efficient cars, including hybrids and diesels.