US auto sales seen up 11% in October
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US auto sales are set to rise 11 percent in October, led by Toyota Motor Corp and Honda Motor Co which benefited from increased demand for compact cars as gasoline prices remained high across the country.
The annual sales rate is expected to be 14.9 million vehicles for the second straight month, according to a Reuters poll of economists. This would also mark the best October since 2007, the year auto sales slowed and the US economy tipped into a recession.
Automakers will report monthly US sales figures on Thursday. This stability at a higher level is taking the edge off the risk factors for the remainder of 2012 and into 2013, as the US economy wrestles with the European crisis, said Jeff Schuster, senior vice president of forecasting at LMC Automotive.
Rising home prices, attractive vehicle financing options and Americans' growing need to replace their aging cars also spurred more consumers to showrooms. Disruptions from Hurricane Sandy, which hit the US East Coast on Monday night, likely cut out about 100,000 vehicle sales - but that demand will come back in November, Jefferies analyst Peter Nesvold said.
Over the last five years, the US auto sector has undergone a wrenching overhaul that led to plant closures, job losses and the government-financed bankruptcy restructurings of General Motors Co and Chrysler Group LLC in 2009. Ford Motor Co also overhauled its US operations but did not take a government bailout.
Auto sales are an early indicator each month of US consumer demand.
An 11 percent jump in October sales would illustrate the continued recovery of the US auto industry, which three years ago was in crisis mode as sales fell to the lowest point in nearly three decades.
The October sales report will be the last before Election Day, marking the end of a contentious US presidential race that has repeatedly thrust GM and Chrysler into the spotlight in televised debates, stump speeches and campaign advertisements.
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