Auto Sales In March Seen Up 23%

J.D. Power and Associates said on Friday that auto sales in March will rise 23 percent from a year earlier, as customers are drawn in by company incentives.

The market research firms is forecasting that 1.1million vehicles will be sold in March, up from the 856,137 units sold last year in the same month, while estimating that the U.S. sales will reach an annualized pace of 12 million cars and light trucks.

This would be the highest level for the industry since the automakers benefited from the government backed "cash for clunkers" stimulus program last August.

"Buyers are starting to feel better," said J.D. Power's director of forecasting, Jeff Schuster. "While the incentives helped this month, we are looking for strong sales to continue throughout the year as access to credit and leasing continues to grow."

Toyota Motor Corp. (NYSE: TM) is leading the incentive based charge in March, after suffering a black-eye on its reputation of quality. Toyota, which usually does not offer incentives on a large scale, has sought to bring customer back to showrooms with zero-percent financing, cash rebates and subsidized leases.

Ford Motor Co. (NYSE: F), General Motors Co. and Chrysler Group LLC have also offered similar incentive packages to lure customers in. The big three U.S. automakers are also making moves on the customer that are fleeing from Toyota following its massive recalls.

"While this may lead to a temporary increase in sales momentum, it could also potentially slow the pace of long-term recovery," Shuster added.

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