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US car sales continue to show strong recovery

Leading with Toyota, automakers posted strong monthly US sales gains.

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Toyota leads US car sales to their best month in since 2008. (JUSTIN SULLIVAN/AFP/Getty Images)

Despite gridlock in other areas of the economy, automakers are enjoying a period of robust sales in the US market. 

Toyota saw sales rise 42 percent in September. Honda reported a jump of 31 percent, while Chrysler sales increased 12 percent, reports the BBC. 

Industry-wide, automakers are on track to reach an annual sales pace of 14.8 million vehicles, Morgan Stanley analysts told Reuters.

That's higher than the 14.5 million rate analysts estimated.

A combination of cheap financing options, including zero percent financing on some models, is bringing in new customers who stayed away during the credit crunch when auto loans were scarce.  

Less qualified, or subprime, buyers are finding it easier to access loans. 

"The money is so cheap now," Jesse Toprak, TrueCar.com analyst told Reuters.

"Higher resale values and cheap money has been enabling automakers to offer some of the most attractive leasing programs we've seen in years."

The auto industry took a huge hit during the recession and automakers are happy to see signs of stable growth. 

"There's a feeling among dealers and automakers that car sales are easing into cruise control, and that's a good feeling for an industry that's felt more than its share of bumps in the last few years," Edmunds.com analyst Jessica Caldwell told the Los Angeles Times. 

Thilo Koslowski, an automotive analyst at research firm Gartner Inc, told the Times that the economy remains fragile and this period of growth may not stick around. 

"A lot of the sales increase comes from pent-up demand that was the result of the huge downturn during the recession," Koslowski said.

"If the next eight months continue to show this upward trend then we will be in really good shape and automakers will be able — at least to some extent — to make up losses from declining global markets."

http://www.globalpost.com/dispatch/news/business/121003/us-car-sales-continue-show-strong-recovery