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What Gas Spike? We want our SUV’s and Pick-ups!


GMC Sierra Crew Cab

Rising gas prices did not keep Americans from buying large pickups and SUVs in February, according to sales results from leading automakers.

Industrywide U.S. auto sales shot up 27% compared to a year ago according to sales tracker Autodata. That’s well above forecasts of about a 19% increase. The sales rate was the best since the Cash for Clunkers program, and at that pace, sales could reach 13.4 million vehicles over a full year.

The month was particularly strong for the sale of light trucks, such as pickups, vans and SUVs, even in the face of higher gas prices. Truck sales rose 32% and had the best sales rate since before the financial meltdown.

The GMC Yukon XL

Auto dealers are seeing consumer demand coming back stronger than  anticipated, along with loans and leases becoming easier to get. The two types of vehicles getting the most attention from buyers are small cars and full-size trucks, like the GMC Sierra 1500. This demonstrates that while fuel economy is becoming more important, there’s still a lot of pent-up demand for larger vehicles.

The increase in gas prices isn’t making the impact on buyers it did even a few years ago, said Paul Ballew, chief economist for Nationwide Financial.

“Keep in mind, we reset our expectations. Five years ago, $3 a gallon was ‘Oh my goodness.’ Now it’s more of a norm,” he said.

 $4 gas? Depends where you live

The real benchmark is more like $4 a gallon, according to Sergio Stiberman, CEO of LeaseTrader.com. He pointed to a survey of those turning in leased trucks, which showed only 16% did so because of high gas prices in February, compared to 78% in summer 2008, when gas hit a record $4 a gallon.

“During the uptick, concerns and complaints heat up when we pass certain price benchmarks, but widespread behavior doesn’t actually change until we reach $4.00 per gallon,” he said.

AAA’s estimate for the average price of a gallon of regular gas stands at $3.375, up 9% in the last month. The price hikes are accelerating as unrest in the Middle East raises crude oil prices, causing a 6% rise in just the last week.

General Motors reported sales jumped 46% from a year earlier. “There’s a lot of speculation about what fuel prices will do for pickups, but these people are buying for needs,” said Don Johnson, GM’s vice president, U.S. Sales Operations. “I don’t see that slowing.”

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March 25, 2011 - Posted by | Coulter Tempe, GMC Trucks | , , , , ,

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