September Sales Rise 29 Percent - But Where's The Party?

U.S. auto sales climbed 29 percent last month, the biggest gain of the year. (Nearly) everybody was a winner: All but two booked increases in September. Suzuki lost 12 percent (itai!), and the “others” brand lost 4 percent. Ford shot up 40 percent. Chrysler rocketed up by 61 percent. GM looked downright lame in comparison by growing only 11 percent. From Porsche (+ 25 percent) to Hyundai (+44 percent), from Daimler (+ 18 percent ) to Toyota (+17 percent), everybody reported huge gains. But why is nobody partying?

Why did Jesse Toprak of TrueCar.com cautiously call it “a solid month, another step in a stable, somewhat painful recovery?” We are comparing with September 2009, when sales had crashed like a junkie on withdrawal. And a withdrawal it had been. The month before, sales had gone on a cash-for-clunkers high. A year later, here are the flash-backs.

Just like the 21 percent drop in August was an aberration, caused by a comparison with a market on drugs, the September numbers should likewise be treated like the mood swings of a detox patient.

“It’s a bit deceptive because last September was so poor after the cash-for-clunkers program ended,” said Gerald Meyers, a professor at the University of Michigan Business School and a former chief of American Motors Corp. Still, “it seems as if auto sales in the U.S. have bottomed out and are headed up from here.”

The notable number is September’s seasonally adjusted sales rate (SAAR). Automotive News [sub] calculates it as 12.2 million, the highest since the cash-for-clunkers high.

The other notable number is the one in the rightmost column of the table that follows. Forget monthly jerks on drugs and on withdrawal. Look at the 9 month changes. 10 percent up. Not bad. But again, it’s a long ways from party time.

U.S. Light Vehicles Sales, September 2010

Data courtesy Automotive News [sub]