The major automakers that sell cars in North America have all reported their November sales figures. Those sales are pretty much booming. The industry is on a pace to sell more than 15 million vehicles for all of 2012; that's a substantial increase over last year's 13 million, but not as torrid as 2005's all-time high of 17 million.
The big story was Honda, an automaker that's endured something of an identity crisis of late and that lost a lot of U.S. market share in the aftermath of 2011's Japanese earthquake and tsunami. Honda's November sales hit an all-time high. Of the more one million vehicles sold in the U.S. in November, almost 120,000 were Hondas. And year-over-year, Honda witnessed November sales leap by nearly 40 percent.
"Honda definitely has momentum in the marketplace," said industry analyst Jessica Caldwell of Edmunds.com. She added that Honda was the bestselling auto brand in the areas hit hardest by Superstorm Sandy, and that a combination of the Accord sedan, the CR-V compact SUV, and the revamped Civic (revamped after a tepid entry to the market last year) all helped Honda to rack up good sales.
The other Japanese carmakers — Nissan and Toyota — also reported double-digit November sales increases compared with 2011. BMW was up a whopping 45 percent.
Sandy clearly played a role here, taking out tens of thousands of cars that need to be replaced. But cheap credit and good deals, with the automakers rolling out various types of incentives, also pushed November sales higher. That said, Caldwell noted that incentives have declined as a trend from October to November, so it isn't just discounts attracting buyers into the dealerships.
Case in point: General Motors. The largest automaker in the world saw the smallest November year-over-year increase of the big players in the U.S. market — 3 percent — but TrueCar.com, an automotive pricing and analysis firm headquartered in Santa Monica, reports that GM's average transaction price in November was higher than the industry average. GM sold cars for $32,891 on average, about $2,000 higher than the industry average of $30,832. And GM achieved this without offering incentives at the same level as other automakers.
That's something that Edmunds' Caldwell said wouldn't last. "It's really a question of how they respond next month, which could be a different story. They'll have to increase incentives to compete."
On the Southern California front, an interesting emerging story is Volkswagen. The German carmaker's U.S. market share lags well behind the Detroit Big Three and the three main Japanese carmakers — Toyota, Honda, and Nissan. The South Koreans' Hyundai and Kia have more. But Volkswagen continues to record sales months in the U.S. that it hasn't seen since the early 1970s. And the Los Angeles market could be particularly important as it strives to sneak up on the Big Six automakers.
"Volkswagen is aggressive about sales targets as a global brand," Caldwell said. "But its North American share is very low compared to the rest of the world." She attributed its 29-percent hike in year-over-year November sales to selling vehicles in major volume segments — sedans like the Jetta and Passat — rather than concentrated on niche segments, as the carmaker had done formerly with vehicles like the New Beetle.
"Volkswagen has done fairly well in Southern California," she said. "They can do better and encroach on the Japanese imports." She agreed that the region, dominated as it is by import brands, could be a happy hunting ground for VW as it works to add market share. "But it's still going to be tough," she insisted.
Overall, Caldwell argued that the carmakers can look forward to a solid conclusion to the industry's best year since the financial crisis and the collapse of GM and Chrysler. She doesn't even regard the fiscal cliff — the looming expiration of federal tax cuts and spending measures — as a limiting factor on the auto industry's continued success in its most competitive market.
"We're teed up for a strong finish," she said.