2015 Chevrolet Colorado

2015 Chevrolet Colorado (General Motors)

Automakers Ride Trucks and SUVs to Strong July Sales

By Auto FOXBusiness

The U.S. auto industry raced to a stronger than expected sales month in July, as consumers continued to ride off with new trucks and sport-utility vehicles.

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Automakers are expected to sell a combined total of at least 17 million vehicles this year. That would reflect a 14-year high. Low-interest auto loans, aging vehicles and cheaper gasoline, as well as redesigned pickup trucks and SUVs, have buoyed demand.

Research firm Autodata calculated a seasonally adjusted annual rate of 17.55 million for July, well ahead of Kelley Blue Book’s forecast for 17.1 million. Industry-wide sales were up 5.3%.

Ford Motor Co. (F) said it booked the company’s best July sales since 2006. Deliveries were up 4.9% to 222,731 vehicles amid a positive month for F-Series trucks, which include the revamped 2015 F-150.

Ford topped Kelley Blue Book’s estimate of a 0.8% gain in monthly sales.

Last week, Ford noted that F-150s should reach full inventory by the end of the third quarter after production was ramped up at two factories. A switch to aluminum body panels forced a slower rollout, which began in December.

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F-Series sales grew 4.8% in July, although they remain down since the start of the year. Ford does not break out sales of the F-150 light-duty pickup.

Utilities were up 13.4%, led by a whopping 39% increase for Lincoln SUVs. The Lincoln brand reported 21% sales growth for July.

Ford, whose car sales dropped 3.9%, was not alone in benefitting from America’s appetite for large vehicles. With many sedans and compact cars losing ground, high-volume automakers are counting on trucks and SUVs to drive growth.

“At least for the moment, it looks like 2014 all over again,” said Kelley Blue Book analyst Akshay Anand. “Almost all of their sales power is coming from SUVs and trucks.”

Trucks and SUVs also carried General Motors (GM) to a better-than-expected July of 272,512 vehicles delivered. GM sales climbed 6.4% with Cadillac the only brand to ship fewer vehicles.

Chevrolet posted 7.8% growth on a 24% increase in pickup, van and SUV sales. GM said the month was Chevrolet’s best July for crossover sales.

The Silverado pickup truck advanced 34%. Sales of the Silverado’s premium sibling, the GMC Sierra, ticked 13% higher.

GM has gained a bigger share of the U.S. truck market this year by outpacing top rival Ford, whose F-Series has led the way for 38 consecutive years. Silverado and Sierra sales combined to total 452,860 through the first seven months of 2015. Ford has sold 423,468 F-Series trucks.

Unlike Ford, GM also competes in the midsize truck segment. According to GM, the Chevrolet Colorado is the fastest-selling truck in America, averaging 16 days on dealer lots. GM’s entire portfolio of pickup trucks recorded a sales gain of 51% last month.

“GM has been steadily growing its commercial sales and retail market share, thanks to our strong truck and crossover portfolio,” Kurt McNeil, GM’s U.S. vice president of sales operations said. “We feel very good about our truck strategy heading into the late summer and fall, when those segments usually heat up.”

Anand noted that more consumers are interested in buying new midsize and full-size pickups, a trend that has lifted transaction prices in the highly profitable segment. New F-150s are selling for a record $44,000 per truck, according to Ford. Buyers seem willing to pay a premium for well-equipped trucks.

“When the economy was tougher, people who bought trucks were need-based shoppers. Now you’re seeing consumers who want them,” Anand said.

Fiat Chrysler Automobiles (FCAU), the smallest of Detroit’s Big Three, got another boost from Jeep. The SUV brand’s sales swung 23% higher, the best showing of any FCA brand in July. Ram trucks added 1%.

FCA said its U.S. sales grew 6% overall, beating Kelley Blue Book’s forecast of 4.4%.

Toyota (TM) posted its fifth straight month of more than 200,000 in U.S. sales. The company’s July sales rose 0.6% year-over-year to 217,181. Light trucks were up 8.6% to mark a new July record for Toyota.

Honda (HMC) deliveries grew 7.7% to 146,324 units, driven by Acura.

Hyundai improved 6%, and Kia reported July sales that grew 7.7%.

Volkswagen and Audi together sold 48,954 units, reflecting an 8.4% increase, as Audi sales jumped nearly 21%.

Nissan sold 130,872 vehicles, up 7.8%.