US car industry enjoys ‘stellar’ year as falling petrol prices fuel sales surge

Falling fuel prices and an accelerating economy lifted US car sales last month, helping to make 2014 one of the strongest years for an industry that five years ago looked to be collapsing.

Sales jumped a seasonally adjusted 13 per cent over December 2013, according to preliminary estimates from Chrysler, the US arm of Italy's Fiat Chrysler Automobiles.

Low interest rates coupled with news in December that the US economy recorded its fastest growth in a decade – at 5 per cent in the third quarter – also made consumers more willing to spend on new cars, analysts said.

The importance of falling petrol prices was underscored by the fact that the biggest beneficiaries were carmakers with the strongest line-ups of more fuel-hungry pick-up trucks and sports utility vehicles. December sales for General Motors – the largest US carmaker by sales – were 19 per cent up year-on-year. Sales for Chrysler, which manufactures the Jeep SUV, were 20 per cent ahead of December 2013.

The industry was closing out a "stellar" year, said Michelle Krebs, analyst at autotrader.com, adding: "If you sold trucks and sports utilities, you had an even better year."

– (Copyright The Financial Times Limited 2015)