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Sandy makes a small dent in October auto sales

By Brent Snavely, Detroit Free Press –

DETROIT — Hurricane Sandy forced thousands of auto dealers in the Northeast to close, cutting industry sales by about 30,000 in the final days of October and assuring a slow start to November sales.

Despite the storm, Americans still bought new cars and trucks at annual pace of 14.3 million last month, as consumer confidence continued to improve. Total sales rose 7 percent from a year earlier.

For the Detroit Three, Chrysler’s sales increased 10 percent while GM was up 4.7 percent and Ford’s sales were flat, edging up 0.3 percent.

Sales increased 15.8 percent for Toyota and 8.8 percent for Honda while Nissan’s sales declined 3.2 percent.

On Thursday, many auto dealers in New Jersey, New York and Connecticut were still without power and manufacturers were scrambling to figure out how many vehicles were damaged by the storm.

Ford dealers suffered damage in New Jersey, New York and Maryland.

“In low lying areas, where the storm surge came in … there are vehicles that are damaged, and we are working really hard to replace those,” said Ken Czubay, Ford’s vice president of U.S. marketing, sales and service.

At a port in Newark, N.J., Toyota is assessing the condition of about 4,000 cars that were sitting on ships waiting to be delivered to dealers, said Bill Fay, head of Toyota division sales. The storm cost Toyota about 4,500 sales in October, Fay said.

Nissan was hit in the region where Sandy hit hardest, where the company has 225 dealers, said Al Castignetti, head of Nissan division.

“In the first part of November, we are going to see a very slow pace of sales, especially in the impacted areas, until the infrastructure comes back online and the insurance claims can be processed,” said Jesse Toprak, vice president of industry analysis for TrueCar.com.

The good news is that the storm’s impact should be temporary.

For most of 2012, new vehicle sales have run well ahead of their year-earlier pace because of pent-up-demand from consumers who postponed purchases during the recession. Now with housing markets strengthening in many metropolitan areas, consumer confidence is rebounding to levels last seen in early 2008.

The Conference Board reported Thursday that its index of confidence reached 72.2, the highest mark since February 2008. The index is still below the level of 90 that’s consistent with a healthy economy. But it’s up from 40.9 a year ago — the sharpest one-year increase since 1994.

That sets up the Detroit Three for a strong finish to 2012, Toprak said. What has been a steady improvement in sales of large pickup continued in October. Sales of Chrysler’s Ram pickups rose 20 percent, 7.6 percent for the Ford F-Series and 5.7 percent for Chevrolet Silverado.

“This was our best October for the F-Series since 2004,” Czubay said.

Truck sales typically increase at the end of the year after farmers harvest their crops and businesses cash in on end-of-the year tax write-offs.

“We have seen some really good housing numbers,” said Ford sales analyst Erich Merkle. “And, when you look at the age of the truck population, it’s very old, so we are seeing some pent-up-demand that is making its way into the market.”

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