Even though VW's growth slowed, last month was still the company's best January in the U.S. since 1974. Sales of the Passat midsize sedan rose 40 percent to 8,856.
January is normally a lackluster month for sales as people avoid going out in winter weather across much of the country. But they were apparently willing to venture to showrooms this year. Perhaps the stock market gave them incentive â¿¿ the Standard & Poor's 500 index had its strongest January since 1997.
"(January) was like a sprinter out of the starting blocks," said Mike Jackson, CEO of AutoNation Inc., the country's largest auto dealership chain.
Analysts say sales for the month should exceed 1 million vehicles and are likely to be 8 percent to 15 percent higher than a year earlier.Jackson, whose chain reported record fourth-quarter earnings per share on Thursday, feared a hangover last month from the strong finish to 2012. But he said people who focused on paying down debt the past few years are now making big-ticket purchases at a robust pace. Consumers are saying: "I'm moving ahead with my life. I'm getting a new vehicle," Jackson said. Buyers crowded dealerships even though incentives weren't as good as last year. The auto industry spent 8 percent less on discounts last month than it did a year earlier, according to the TrueCar.com auto pricing site. Of all major automakers, only Hyundai and Volkswagen raised incentives from what they spent in January of 2012, TrueCar said. But that could change later in the year as automakers are expected to compete for sales with new vehicles and better deals. Automakers are looking to the U.S. market to compensate for falling sales in Europe and slowing growth in emerging markets. The U.S. appears poised to deliver as the economy heats up, said Jeff Schuster, senior vice president of forecasting for LMC Automotive, an industry consulting firm.