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Auto sales grew 5% in 2014

Dec 26, 2014

Credit Lester Graham / Michigan Radio

It was a record year for recalls in 2014.  But that didn't appear to hamper new car sales in the slightest.

Analysts expect 16.4 million in car sales for the year.

"It looks like 2014 will be the strongest year we've seen since well before the recession started," says Jessica Caldwell of Edmunds.com.

Jeff Schuster of LMC Autos says it's because of a genuine consumer demand for new cars.

That natural demand is a big difference between the industry now, and the last time it was selling this many cars.

Schuster says the percentage of car sales to rental companies is about 17%, down from 20 to 22% in the "bad old days." Fleet sales are not as profitable as sales to individual consumers, and high fleet sales are one sign a company is running into financial trouble.

"Manufacturers are not using fleet to keep factories running," says Schuster.

He says automakers are also not relying too heavily on incentives to move the metal. 

The recent drop in gas prices influenced the kinds of cars people bought.

Sales of pickup trucks and SUVs increased, at the expense of small cars, electrics, hybrids, and cars with diesel engines.

Jessica Caldwell says two automakers in particular had rising stars in 2014: Chrysler, which continued its pace of double-digit sales increases, when most people assumed they'd have plateaued, and Subaru, which continues its shift from a niche automaker to a mainstream brand.