U.S. Automakers Went Full Throttle in 2011

by Jim Woods | January 5, 2012 12:48 pm

It was life in the fast lane for automakers in 2011. Last year, the industry enjoyed its best year since the Great Recession, and along with those revved-up sales came some high-octane profits. In fact, all three U.S. automakers set a course toward profitability in 2011, and as earnings are released in the weeks ahead, we’ll find out just how profitable a year it actually was.

In terms of auto sales, U.S. automakers crossed the December finish line with emphatic gains, as the industry saw its seventh consecutive month of increased sales. During the final month of the year, total sales spiked 8.7%. That metric helped top off a year that saw sales increase 10% year-over-year. In terms of raw numbers, 2011 saw about 12.8 million vehicles sold.

Who were the biggest winners in the race for industry supremacy? As it turns out, U.S. automakers. General Motors (NYSE:GM[1]), Ford (NYSE:F[2]) and Chrysler saw increases in their respective market share — the first time they’ve done so in more than two decades, according to the automotive research website Edmunds.com.

A combination of aging autos, very attractive financing options and a slow but steady improvement in the U.S. economy helped the “Big 3” post strong yearly numbers. Here’s a breakdown of how the biggest automakers fared in December:

As for foreign automakers, Germany’s Volkswagen (PINK:VLKAY[3]) reported a monthly sales increase of a whopping 31.4%, while South Korea’s Hyundai saw a 13.3% gain. Japan’s Nissan (PINK:NSANY[4]) reported a 7.7% sales increase, but the two biggest Japanese automakers — Toyota (NYSE:TM[5]) and Honda (NYSE:HMC[6]) — had a much tougher time of things. Toyota reported virtually flat December sales, while Honda reported a disappointing 18.8% monthly decline.

So, what will 2012 bring for the auto industry? According to most industry analysts, sales are expected to continue climbing. Edmunds.com is forecasting 2012 sales of 13.6 million, while fellow industry watchers TrueCar.com expect slightly higher sales of 13.8 million. If these estimates for the industry prove prescient, it could be time to buckle up behind the wheel of stocks in the sector.

As of this writing, Jim Woods did not hold a position in any of the aforementioned stocks.

  1. GM: http://studio-5.financialcontent.com/investplace/quote?Symbol=GM
  2. F: http://studio-5.financialcontent.com/investplace/quote?Symbol=F
  3. VLKAY: http://studio-5.financialcontent.com/investplace/quote?Symbol=VLKAY
  4. NSANY: http://studio-5.financialcontent.com/investplace/quote?Symbol=NSANY
  5. TM: http://studio-5.financialcontent.com/investplace/quote?Symbol=TM
  6. HMC: http://studio-5.financialcontent.com/investplace/quote?Symbol=HMC

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