US car sales end 2016 on strong note, possible record

The US consumer buoyed carmakers to a big finish in 2016, with strong December sales figures released Wednesday suggesting the industry could set a new yearly record.

During a usually busy shopping period in which consumers seek year-end discounts, many auto makers reported sales gains in the final month of the year.

While Toyota and GM said their total sales in 2016 were down from a record year in 2015, Ford reported its best year in a decade and Nissan said it sold a record number of cars in the US.

GM predicted the industry as a whole would best 2015's record sales.

"Key economic indicators, especially consumer confidence, continue to reflect optimism about the US economy and strong customer demand continues to drive a very healthy US auto industry," GM Chief Economist Mustafa Mohatarem said in a statement.

"We believe the US auto industry remains well-positioned for sales to continue at or near record levels in 2017."

But some industry analysts say car sales likely are plateauing and could decline in 2017.

"Elevated inventories, a slow model-year transition and record incentive levels point to the challenges the industry will face in 2017," JD Power auto analyst Deirdre Borrego said.

"Going forward, automakers must maintain production and pricing discipline to achieve profitability, which is easier said than done."

Automakers have seen inventories of sedans swell, even as demand for trucks and SUVs have stayed robust. GM announced in December that it would close five US manufacturing plants for one to three weeks this month, in response to lower demand.

Still, the sales figures were mostly upbeat.

Toyota said US sales increased two percent in December, but declined two percent for 2016 to 2.4 million vehicles.

GM reported a 10 percent increase in the month compared to December 2015, led by its Chevrolet brand, which had its best year since 2006.

But the biggest US automaker said total sales fell 1.3 percent in 2016 from 2015, to just over three million vehicles.

Ford managed a mere 0.3 percent sales gain for December, but reported its best sales year in a decade. The company said it sold more than 2.6 million vehicles in 2016, 61 percent of them trucks and sport utility vehicles.

However, the North American subsidiary of Fiat Chrysler, FCA US, recorded another bad month, as US sales fell 10 percent, following the 14-percent drop in November.

And the company said total 2016 sales were flat compared to the previous year. The bright spots for FCA US were Ram truck sales, which increased 10 percent, and some Jeep models, which also posted gains.

Nissan reported a banner 2016, with an all-time record of 1.4 million vehicles sold, up five percent from the previous year. The company said its Rogue crossover vehicle was its best-selling model.

Nissan's December sales jumped 9.7 percent compared to the year-ago period.