Auto Sales Peak In April, But Industry Trapped In Economic Dilemma

Americans have shown great interest toward auto vehicles since time immemorial, hence the evident growth of auto sales in the past few years. The month of April this year, in particular, displayed huge numbers from U.S. consumers who purchased trucks and SUVs (also known as sport-utility vehicles). But despite the increase, analysts believe that the auto-market is left with nothing but a small room to breathe.

According to the Los Angeles Times, U.S. consumers have purchased roughly 1.5 million vehicles just in the month of April alone. The figure was quite amassing that it dethroned the oldest auto sales record set in April 2005.

In 2005, auto sales hiked due to automakers offering huge discounts and lease deals in hopes to keep their manufacturing plants running. However, this time around, it was the consumers who were responsible in driving auto sales to a massive hit.

Among the major global automakers, Honda, led with a whopping 14.4 percent auto sales increase -- both in cars and SUVs. Nissan, on the other hand, rose at 12.8 percent.

Fiat Chrysler and Ford also rode with 6 percent and 4 percent, respectively. Lastly, Toyota acquired a total of 3.8 percent auto sales, thanks to the notable RAV 4 small SUV (which just recently broke a monthly auto sales record of up to 32 percent).

While this increase in auto sales numbers is fascinating, automakers should still be alarmed, as reported by Washington Post. Wall Street analysts reportedly said that the U.S. auto industry is nearing a cyclical peak, and as this enters, automakers must opt into more production cuts. Although this is only right in order to keep records of vehicles from inflating later this year, this could also affect auto sales profits.

In fact, the shares for both General Motors and Ford have dropped by 1 percent, while Fiat Chrysler Automobiles plummeted to more than 2 percent. And although GM's (as well as Ford's) auto sales to individual consumers are still increasing, its overall U.S. auto sales in April have been decked by 3.5 percent.

Analysts believe that the sluggish economic pace in the U.S. has been one of the major factors in this upcoming dilemma. While these auto sales forecasts can be proven in the following months to come, it is still a topic worth worrying about.

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