People who put off buying cars this summer because Japanese brands were in tight supply returned to the market in October, lifting U.S. auto sales to their fastest pace in two years.
Automakers will report sales for October on Tuesday.
Car information site Edmunds.com predicts sales of more than 1 million cars and trucks for the month. When adjusted for seasonal factors, that would be the best pace since the Cash for Clunkers program in August 2009. J.D. Power and Associates also says October sales finished strong, although it forecast a slightly slower pace.
Edmunds economist Lacey Plache called October a "mini-bubble" and said she expects the sales pace to fall off a bit once pent-up demand is satisfied. But Edmunds still expects total U.S. sales to rise by nearly 1 million vehicles to 13.5 million in 2012 compared to 2011. An improving economy, better credit availability and an aging fleet of vehicles on the road all point to higher sales in 2012.
Pent-up demand drove October sales. Many buyers were waiting to Japanese car inventories to improve after the March earthquake and tsunami in Japan cut supplies. Toyota Motor Corp., Honda Motor Co. and Hyundai Motor Co. will be the biggest market share gainers in October, Edmunds said.
Because they had more vehicles at dealerships, Japanese carmakers also offered more deals, which drew in buyers. TrueCar.com estimated that Toyota's incentives were up 13 percent from last October, while Honda's were up 18 percent. Detroit automakers showed little change in their incentive levels. The average incentive offer was $2,669 per vehicle in October, up 5 percent from last year, TrueCar said.
Truck buyers also were out in force in October, drawn partly because of automakers' traditional "Truck Month" promotions. That's a good sign for the economy, since large truck buyers are generally people who need trucks for construction or other work.
Falling gas prices might also be helping push some buyers off the fence and into dealerships. Gas prices now average $3.46 per gallon nationwide, down from a peak of nearly $4 in May.