US auto sales remain red-hot in October

US auto sales have been on fire in recent months, with October's seasonally-adjusted annualized rate of 18.13 million units outpacing the stellar 18.06 million units sold in September. This is the best October showing seen since 2001, and the sixth straight months of sales above the 17 million unit mark.

Most automakers recorded sizable gains in October relative to year-ago levels. Of the top eight selling brands, Hyundai (+19.8% y/y) was the top performer, while Kia, the Detroit-3 and Japanese automakers were up strongly, with all but Honda (+8.6% y/y) recording gains in the 12-15% range. Still dealing with the fallout from the emissions scandal that broke in mid-September, Volkswagen sales were flat during the month on a year-ago basis. This compares to a 13.6% y/y increase in industry-wide sales.

Auto sales have gained momentum, fueled by low interest rates, lengthening loan terms, strong demand for light trucks, and a healthy economy. While many of these factors are likely to remain in place over the near term, it will be difficult for sales to be sustained above the lofty 18 million unit mark.

October's tally starts the fourth quarter off on a high note, and auto sales will likely remain a bright spot in the U.S. economy for the remainder of the year - even if the SAAR falls from current levels. For the year as a whole, auto sales are tracking 17.27 million units - a sizable increase over last year's 16.44 million units.