AUBURN HILLS (WWJ) – A strong December propeled the auto industry to its best sales year since 2007.

“There’s no question the year ended on a high note,” said Jeff Schuster, who directs the forecasting team at LMC Automotive. “In fact, it exceeded all our expectations.”

The seasonally adjusted annual sales rate topped 15.5 million in December, a post recession record. That lead to total 2012 sales above 14.5 million, an increase of more than 13 percent from 2011.

“It was a very solid year,” said Schuster. “It was clear that consumers really needed to replace vehicles.”

Pent up demand was one factor given for the higher sales. Other factors include easier access to credit and a variety of new products.

Volkswagen lead all automakers with a 35 percent sales increase for the full year.

Japanese carmakers also saw a strong rebound from 2011, when they were hurt by product shortages caused by a number of natural disasters. That lead to a huge variation in year to year car sales increases. Toyota sales were up 27 percent. Honda sales for the year rose 24 percent.  GM, four percent.

“A lot of things going on in the marketplace, with the Asians coming back,” said GM Sales Operations Manager Kurt McNiel. “But, we feel good about the performance.”

Nissan sales rose 9 percent.  2012 was the first year to see the company sell more than a million vehicles in the United States.

Ford sales rose 5 percent in 2012. Chrysler lead the domestics with a 21 percent sales increase for the full year.

“Their sales are up,” says senior analyst Jessica Caldwell. “A lot of people thought they wouldn’t be in business at this point. So, I think there’s a lot to be happy about at Chrysler.”

After a weak November, the new Dodge Dart compact had its best sales month ever, with sales up 36 percent month to month.

Ford Chief Economist Ellen Hughes-Cromwick says auto sales have grown 40 percent since the bottom of the recession, an addition of four million sales a year.

“This represents significant sales growth, and is typically not seen when the economy is growing in the two percent range.”

Ford projects that car sales will run in the 15 to 16 million range in 2013. GM’s Kurt McNiel feels the strong ending to 2012 sets things up for a solid 2013.

“Obviously, we see some good, fundamental growth still coming with the economy. Housing still looks good consumer credit still looks good. Now that we’ve resolved a few things in Washington, we’re still calling for good, steady growth into 2013.”

While 2012 saw Japanese carmakers posting higher sales gains, LMC Analyst Jeff Schuster says that was mostly due to their recovery from the earthquake and tsunami. He says the landscape becoming more balanced in 2013.

“I think we are expecting to see a very highly competitive market.”

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