* Strong housing market boosts GM's small business sales
* Rising home prices help consumers feel more confident
* March auto sales up 3.4 pct, annual sales pace 15.27 mln
By Ben Klayman and Deepa Seetharaman
DETROIT, April 2 U.S. sales of sport-utility
vehicles and pickup trucks jumped in March, spurred by rising
home prices and an increase in housing construction, major
automakers said on Tuesday.
In March, new light-vehicle sales rose 3.4 percent and the
annual sales pace reached 15.27 million, in line with analyst
expectations. This marked the fifth straight month the industry
sales rate topped 15 million.
General Motors Co said the stronger housing market
helped its sales to small businesses rise nearly a third. Ford
Motor Co, the No. 2 U.S. automaker, posted a 16.3 percent
rise in sales of its F-Series pickup trucks.
"The housing sector recovery is in full swing," Ford senior
U.S. economist Jenny Lin told reporters and analysts.
The U.S. housing sector is starting to contribute to growth
after years of dragging down the broader economy. Rising home
values are helping U.S. consumers feel more confident about
buying a new vehicle, GM and Ford executives said.
Home prices in 20 metropolitan areas rose 8.1 percent in
January from a year earlier, the biggest 12-month rise since
June 2006. Meanwhile, U.S. home builders are breaking ground on
more new houses this year, boosting truck sales.
In about a month, GM will launch redesigned Chevrolet
Silverado and GMC Sierra big pickups as 2014 models. Ford is
planning an overhaul of its F-150 next year.
Pent-up demand and a wider range of financing options have
also helped boost sales, executives said. The average age of
vehicles on U.S. roads is more than 11 years, an all-time high,
and many consumers can no longer put off buying a replacement.
"You're not only having better traffic level, you're also
having better success with so many people who got hit on their
credit scores during the recession," Al Castignetti, U.S. sales
chief for the Nissan brand, said in an interview.
"That's opening up a whole new segment that was kind of
locked out of the auto industry the last couple of years."
A 'TRICKY' RECOVERY
Auto sales each month are an early indicator of economic
health. The auto industry is in the midst of its fourth year of
recovery from an economic downturn that pushed GM and Chrysler
into bankruptcy in 2009.
GM sold 245,950 vehicles in March, up 6.4 percent from a
year earlier but falling short of at least three estimates. Ford
sales rose 5.7 percent to a stronger-than-anticipated 236,160
vehicles, making March its best month since May 2007.
GM also posted a 31 percent sales gain in crossovers
vehicles, such as the Chevrolet Traverse. Ford posted a 15.4
percent spike in sales of SUVs, such as the Escape.
Toyota Motor Corp posted a 1 percent rise in U.S.
sales to 205,342 vehicles. Chrysler Group LLC, the
third-largest U.S. automaker, rose 5 percent to 171,606, its
best month since December 2007.
"If I had to sum up the month in one word, it would be
'Wow'," Toyota's head of U.S. auto operations Bob Carter said.
In a surprise development, the Nissan Altima eked past the
Toyota Camry to be the best-selling U.S. mid-size sedan in
March. The difference between the two models was exactly 100
Carter acknowledged that Toyota has not redesigned the Camry
as recently as other rivals. But he said the Camry remains on
track to be the top-selling car in this bread-and-butter segment
for the thirteenth straight year.
The U.S. auto market is among the strongest in the world and
is increasingly critical for major automakers as car sales in
European tumble. Sales in Spain, for example, fell 13.9 percent
in March, figures released on Tuesday showed.
GM stuck to its forecast for U.S. industry sales as high as
15.5 million this year, which would be the best year since 2007,
before the U.S. economy slid into recession.
The industry's swift recovery over the last few years has
allowed the sector to be a bright spot during an uncertain
economic recovery. But TrueCar.com analyst Jesse Toprak said
those outsized gains would be difficult to maintain.
"After this year, it's going to become a bit tricky," he
said. "Getting to 15.5 (million) is not going to be as tough as
getting to 16.5 (million). Getting there may take another couple