Getty Images
A Chevrolet dealership with a full lot of Chevy pickup trucks in Lexington, Kentucky.
Surprisingly strong auto sales for March are leading some economists to be more confident in their economic outlook after a rough start to the year.
Motor vehicle sales reached a seasonally adjusted annual rate of 17.45 million in March, up from 16.57 million in February, according to data from Autodata. That’s the highest reading in three months and represents a recovery from a downbeat start to the year. The MarketWatch-compiled consensus expectation was for a 16.8 million rate.
The sales were driven for a record month for light trucks. Ford F, +1.26% said its SUV sales reached a record in the first quarter and that incentives for the F-series was the lowest among all major full-size pickups. By contrast, car sales at Ford plunged 24% in the first quarter, so the auto maker’s quarterly vehicle sales fell 1.6%.
There was a similar story at General Motors GM, +1.09% —vehicle sales fell 7% in the first quarter despite records for the Chevrolet Trax, Equinox and Colorado sport-utility vehicles.
“The rebound in March puts sales in line with the average for [the fourth quarter], and suggests that consumption spending remains on track,” said Pooja Sriram of Barclays in a note to clients. The bank lifted its estimate of first-quarter GDP to 2.1% from 1.7%.
Jim O’Sullivan of High Frequency Economics made a similar point. “The data reinforce our view that the slowing in retail sales through February was exaggerated,” he told clients.
Scott Brown, chief economist at Raymond James, said the growth may have reflected some catch-up. “An upside surprise, likely reflecting pent-up demand from February’s poor weather and the partial government shutdown in January. Still, the trend is lower into 2019,” Brown said.
