General Motors on Wednesday reported an unexpected 8 percent rise in December U.S. auto sales while Ford Motor Co also beat forecasts, indicating that 2016 results will beat a record high set in 2015.
“Key economic indicators, especially consumer confidence, continue to reflect optimism about the U.S. economy, and strong customer demand continues to drive a very healthy U.S. auto industry,” said Mustafa Mohatarem, GM’s chief economist.
“We believe the U.S. auto industry remains well positioned for sales to continue at or near record levels in 2017.”
Analysts polled by Reuters expected GM’s December U.S. sales to increase by about 3.5 percent from a year earlier. Ford’s December U.S. sales increased 0.3 percent while Wall Street estimated a decline of about 2.5 percent.
The better-than-expected results helped boost shares of GM , up 4.4 percent, and Ford up 4.2 percent.
GM said December industry sales will be a robust 18.2 million vehicles on a seasonally adjusted annualized basis, far exceeding the 17.7 million vehicles forecast by 35 economists polled by Thomson Reuters.
Ford Chief Executive Officer Mark Fields said on Tuesday the auto industry and Ford will be helped by “pro-growth” policies expected by the incoming administration of U.S. President-elect Donald Trump.
GM and Ford notched the gains as they kept inventory at healthy levels.
GM ended the year with 71 days of inventory, meeting its target of about 70 days of supply. Ford ended with 70 days of U.S. inventory. Analysts were concerned that GM’s inventory levels were high, but the data showed otherwise.
Ford was led by the F-Series pickup truck, which rose 2.7 percent to 87,512. The model line was the top-selling pickup truck in the United States for a 40th consecutive year.
Japan’s Toyota Motor reported a 2 percent gain. Analysts expected a decline of 1 percent to 4 percent.
Fiat Chrysler Automobiles’ sales slid 10 percent while analysts looked for a decrease of between 10 percent and 15 percent. The fall was partly due to production ending on several sedan models.
However, sales at its Jeep brand, which has been its strongest since the 2008-2009 recession, fell 6 percent in December. Jeep Cherokee sales fell 25 percent as rivals fielded new models in the increasingly competitive midsize SUV segment.
Investors will watch to see if consumer discounts, which cut into company profits, are also at a record high, which analysts expected.
Nissan Motor’s sales rose 10 percent in December, led by its luxury brand Infiniti, which gained 20.6 percent.