Cars and light trucks sold at a 15.2 million annualized rate in May, making it the sixth month out of the last seven to exceed the 15-million mark -- a level that previously hadn’t been reached since February 2008.
A pickup in growth in the world’s largest economy is convincing executives at Toyota Motor Corp. that the Japanese automaker will meet a sales goal for its Prius model in the U.S. after saying in April that the world’s biggest carmaker may adjust the target as declining gas prices restrained demand.
“We’re on target for sales of 250,000 units of the Prius family,” Jim Lentz, Toyota’s North American chief executive officer, said yesterday in Nagoya City, Japan. “The U.S. economy finally seems to be improving.”
Sales at general merchandise stores rose 0.5% in May after a 0.3% drop. Purchases also improved at building materials outlets, sporting goods stores and so-called non-store retailers.
In the category that excludes autos, gasoline and building materials, which are the figures used to calculate gross domestic product, sales increased in May after a revised 0.2% gain in the previous month.
Same-store sales also showed signs of strength last month, rising for nine of the 10 companies tracked by Swampscott, Massachusetts-based Retail Metrics. L Brands Inc.’s sales climbed 3%, beating the 2.9% estimate. Purchases at the company’s Victoria’s Secret brand were up 4%, while the Bath & Body Works brand gained 3%.
San Francisco-based Gap, the largest U.S. specialty apparel retailer, last week reported a 7% increase in May sales compared with the same month in 2012, almost double the 3.7% gain projected by analysts on average.
The American consumer “is incredibly resilient,” Eric Wiseman, chief executive officer of VF Corp., the world’s largest apparel maker, said in an interview yesterday. “Are there risks that the economy could slow down? Yes. But for now, the consumer seems pretty engaged.”
Household spending will grow at a 1.9% annualized rate this quarter after expanding at a 3.4% pace in the first three months of the year, the most since the end of 2010, according to the median forecast of 66 economists surveyed by Bloomberg from June 7 to June 12. Purchases are projected to climb at an average 2.4% annualized rate in the second half of the year.
Strength in the stock and housing markets is helping to bolster household balance sheets and keep Americans spending amid higher taxes. The Standard & Poor’s 500 Index has advanced 13.1% this year.
Property values rose 10.5% in the 12 months through March, the biggest gain in seven years and the 13th consecutive advance in national home prices, according to Irvine, California-based CoreLogic Inc.
Bigger job gains that lead to increased wage growth would help contribute to an even faster pace of consumer purchases. Employers added 175,000 jobs last month, the Labor Department said last week. Job gains averaged 176,250 in the year ended last month.