Auto sales rise in 1st half, but analysts warn of turbulence - KAIT Jonesboro, AR - Region 8 News, weather, sports

Auto sales rise in 1st half, but analysts warn of turbulence

(Source: AP Graphics Bank) (Source: AP Graphics Bank)

DETROIT (AP) - Neither higher gas prices nor rising interest rates could put a damper on U.S. auto sales during the first half of the year.

Sales rose 1.8 percent during the first half of the year, while June sales were up about 5 percent compared with a year ago, according to Edmunds.com.

Analysts said the boost was fueled by strong consumer confidence and low unemployment.

But analysts at Cox Automotive, which includes Kelley Blue Book, issued a cautionary note on the numbers, saying that much of the increase was due to low-profit sales to fleet buyers such as rental car companies, and retail sales to individual buyers were propped up by rising incentives such as rebates and subsidized leases.

Sales are "defying gravity" said Jonathan Smoke, chief economist for Cox. "Retail sales have been flat, and even those sales have been supported by incentives being up 6 percent."

Cox analysts also said rising interest rates and a possible trade war due to tariff threats from President Donald Trump could raise new-vehicle prices and payments and cut into auto sales in the second half. Still, given the fact that automakers are willing to spend to keep their share of the market, Cox analysts raised their full-year forecast by 100,000 vehicles to 16.8 million vehicles.

Trucks and SUVs accounted for 68 percent of the market in June, a record high as car sales continued to fade, Edmunds said.

The Federal Reserve in mid-June raised its benchmark interest rate for the second time and signaled that it may step up the pace of rate increases. The central bank raised its key short-term rate by a modest quarter-point to a still-low range of 1.75 percent to 2 percent. It means that consumers and businesses will face higher loan rates over time.

But Cox analysts said auto interest rates held steady in June, although they expect them to rise. Bankrate.com said on its website new-auto loans are now around 4.75 percent. Gas prices rose 63 cents per gallon over a year ago to an average price for regular of $2.86, according to AAA, taking a bigger bite out of household budgets.

Here's how major automakers fared for the first six months of the year, according to Edmunds, which regularly provides content, including automotive tips and reviews, for distribution by The Associated Press:

- General Motors, up 4.2 percent.

- Ford, down 1.8 percent.

- Toyota, up 3.0 percent.

- Fiat Chrysler, up 4.5 percent.

- Honda, down 0.5 percent

- Nissan, down 4.8 percent.

- Hyundai, down 3.3 percent

- Volkswagen, up 7.2 percent

Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  • National SportsMore>>

  • France wins 2nd World Cup title, beats Croatia 4-2

    France wins 2nd World Cup title, beats Croatia 4-2

    Sunday, July 15 2018 1:03 PM EDT2018-07-15 17:03:26 GMT
    Sunday, July 15 2018 3:24 PM EDT2018-07-15 19:24:31 GMT
    (AP Photo/Martin Meissner). France's Kylian Mbappe, front, celebrates after scoring his side's fourth goal during the final match between France and Croatia at the 2018 soccer World Cup in the Luzhniki Stadium in Moscow, Russia, Sunday, July 15, 2018.(AP Photo/Martin Meissner). France's Kylian Mbappe, front, celebrates after scoring his side's fourth goal during the final match between France and Croatia at the 2018 soccer World Cup in the Luzhniki Stadium in Moscow, Russia, Sunday, July 15, 2018.
    France won its second World Cup title by beating Croatia 4-2 in a match briefly interrupted by an on-field protest that Russian punk band Pussy Riot later took credit for.
    France won its second World Cup title by beating Croatia 4-2 in a match briefly interrupted by an on-field protest that Russian punk band Pussy Riot later took credit for.
  • Pussy Riot claims on-field protest at World Cup final

    Pussy Riot claims on-field protest at World Cup final

    Sunday, July 15 2018 12:38 PM EDT2018-07-15 16:38:16 GMT
    Sunday, July 15 2018 3:24 PM EDT2018-07-15 19:24:24 GMT
    (AP Photo/Francisco Seco). Security stewards remove people who ran onto the pitch and briefly stopped the final match between France and Croatia at the 2018 soccer World Cup in the Luzhniki Stadium in Moscow, Russia, Sunday, July 15, 2018.(AP Photo/Francisco Seco). Security stewards remove people who ran onto the pitch and briefly stopped the final match between France and Croatia at the 2018 soccer World Cup in the Luzhniki Stadium in Moscow, Russia, Sunday, July 15, 2018.
    Russian protest group and punk band Pussy Riot has claimed responsibility for four people who ran onto the field and disrupted the World Cup final.
    Russian protest group and punk band Pussy Riot has claimed responsibility for four people who ran onto the field and disrupted the World Cup final.
  • Stone wins Scottish Open, misses 1st 59 on European Tour

    Stone wins Scottish Open, misses 1st 59 on European Tour

    Sunday, July 15 2018 1:38 PM EDT2018-07-15 17:38:49 GMT
    Sunday, July 15 2018 3:23 PM EDT2018-07-15 19:23:42 GMT
    The elusive round of 59 on the European Tour is safe for another tournament.
    The elusive round of 59 on the European Tour is safe for another tournament.
  • NationalMore>>

  • The Latest: Police say suspect shot third Kansas City cop

    The Latest: Police say suspect shot third Kansas City cop

    Sunday, July 15 2018 3:24 PM EDT2018-07-15 19:24:46 GMT
    Sunday, July 15 2018 3:24 PM EDT2018-07-15 19:24:46 GMT
    Authorities say a suspect in the non-fatal shooting of two Kansas City police officers shot a third officer who was searching for him and has barricaded himself inside of a home.
    Authorities say a suspect in the non-fatal shooting of two Kansas City police officers shot a third officer who was searching for him and has barricaded himself inside of a home.
  • 2 admit to manslaughter in NYC house blast; firefighter died

    2 admit to manslaughter in NYC house blast; firefighter died

    Sunday, July 15 2018 12:23 PM EDT2018-07-15 16:23:48 GMT
    Sunday, July 15 2018 3:24 PM EDT2018-07-15 19:24:45 GMT
    (AP Photo/Mary Altaffer, File). FILE - In this Sept. 27, 2016 file photo, emergency service personnel work at the scene of a house explosion in the Bronx borough of New York where firefighter Michael Fahy, a 17-year fire department veteran was killed a...(AP Photo/Mary Altaffer, File). FILE - In this Sept. 27, 2016 file photo, emergency service personnel work at the scene of a house explosion in the Bronx borough of New York where firefighter Michael Fahy, a 17-year fire department veteran was killed a...
    Two men have pleaded guilty to manslaughter in an explosion at a marijuana grow house that killed New York City fire battalion chief.
    Two men have pleaded guilty to manslaughter in an explosion at a marijuana grow house that killed New York City fire battalion chief.
  • Deadly fire shuts down key route to Yosemite National Park

    Deadly fire shuts down key route to Yosemite National Park

    Sunday, July 15 2018 2:04 PM EDT2018-07-15 18:04:23 GMT
    Sunday, July 15 2018 3:24 PM EDT2018-07-15 19:24:43 GMT
    (Andrew Kuhn /The Merced Sun-Star via AP). Crews battle the Ferguson Fire along steep terrain behind the Redbud Lodge along Highway 140 near El Portal in Mariposa County, Calif., on Saturday, July 14, 2018.(Andrew Kuhn /The Merced Sun-Star via AP). Crews battle the Ferguson Fire along steep terrain behind the Redbud Lodge along Highway 140 near El Portal in Mariposa County, Calif., on Saturday, July 14, 2018.

    A wildfire that killed a California firefighter has grown quickly and forced the closure of a key route into Yosemite National Park.

    A wildfire that killed a California firefighter has grown quickly and forced the closure of a key route into Yosemite National Park.

Powered by Frankly