Are Ford and GM about to blast off?

BY ADAM WIDMER
Posted on JUL 31, 2019

Strong sales could prompt the big Detroit automakers to put a foot on the gas as the economy rebounds.

The U.S. economy continues to accelerate, and it means the big Detroit automakers may finally be able to really see some growth.

With May sales data about to be released, investors are waiting anxiously to see if automakers will meet expectations to achieve near record revenues totals, which would allow the automaking industry to overcome product recalls and poor growth and blast off, according to a Business Standard report.
Financial experts estimate that a total of 1.6 million new cars and trucks were sold in May, which would be a seasonally-adjusted rate of 17.4 million vehicles -- that would be one of the best months ever.

May sales revenues could be close to $40 billion, the most since August 2014 which had $40.3 billion in sales.

April sales were weak, but May is expected to be a big rebound month, and lower gas prices could cause consumers to flock to higher-profit sport utility vehicles and trucks. There's also more demand for new vehicles, as consumers look to shed their aging cars that they've had to keep a hold on during the financial crisis and open up their pocketbooks for a gleaming new set of wheels. The average car is about a decade old, according to the report.

The fact that there was a full week after Memorial Day that fell in the month of May will also help sales figures.

Meanwhile, auto loan credit is continuing to expand, a positive growth indicator for the industry