DETROIT (AP) — Chrysler’s U.S. sales jumped 30 percent last month, a sign that Americans remain determined to replace their aging cars despite the falling stock market and shaky consumer confidence.
The company said it sold more than 150,000 cars and trucks in May, compared with 115,000 in the same month a year earlier. Chrysler brand sales rose 80 percent, while Jeep sales increased 24 percent.
Chrysler was the first automaker to report sales today. Total U.S. sales for May should rise 30 percent to 1.4 million cars and trucks, according to forecasts from industry analysts. They expect sales for 2012 to reach 14.5 million, up from 12.8 million last year.
Analysts say the May figures likely will show that pent-up demand is overpowering any fears about the economy. Unemployment in May rose for the first time in 11 months, increasing slightly to 8.2 percent. The stock market had its worst month in two years, and consumer confidence was wobbly. Yet auto sales are expected to remain resilient.
“In spite of a tremendous amount of global economic uncertainty, the U.S. new vehicle sales industry continues to power ahead,” said Reid Bigland, Chrysler Group LLC’s U.S. sales chief.
People are buying because they have to replace aging cars and trucks that they kept through the Great Recession. The average age of a vehicle on U.S. roads is now pushing 11 years, and they are simply wearing out.
“You have so many old vehicles on the road,” said Tom Libby, lead analyst for the Polk automotive research firm who sees auto sales continuing to grow through the next two or three years.
People also feel a bit flusher because gasoline prices have tumbled to an average of $3.61 a gallon. That’s 33 cents below the peak of $3.94 on April 6. Some experts say gas could fall as low as $3.40 between now and Labor Day.
A big auto sales increase in May won’t be a surprise, because May of 2011 was a poor month.
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