(Corrects second bullet point to show JP Morgan forecasting 14.5 mln sales rate, not 14.3 mln)
* Higher gasoline prices spur sales of compact cars
* JP Morgan: Aug on track for 14.5 million annual sales rate
* GM’s August sales rise 10 pct, Ford up 13 pct
By Bernie Woodall and Deepa Seetharaman
DETROIT, Sept 4 (Reuters) - U.S. auto sales continued to show a slow but steady recovery in August, as all three Detroit automakers reported sales gains that outstripped analyst expectations.
General Motors Co posted a 10 percent jump, as higher gasoline prices spurred sales of GM’s Cruze and other compact cars. Average U.S. gasoline prices have risen about 21 cents a gallon in the past month.
“Higher gas prices in August will lead to unseasonably strong small car performance across the industry,” said Edmunds.com analyst Jessica Caldwell.
With roughly 70 percent of the market reporting so far on Tuesday, the U.S. auto industry is on track to show an annual sales rate of 14.5 million vehicles, J.P. Morgan said. Analysts polled by Reuters forecast an annualized sales rate of 14.2 million light vehicles.
GM predicted an annual sales rate of about 14.6 million for August. Ford Motor Co, the second-largest U.S. automaker, said the sales rate for the month would be in the mid- to high-14 million range, including medium and heavy trucks.
So far this year, the U.S. auto sales rate has been 14.3 million on an annualized basis, GM said. Automakers are banking on a rebound in U.S. auto sales in the second half of the year after sales dipped in the spring.
GM said sales rose to 240,520 vehicles. Ford’s U.S. August sales rose 13 percent to 197,249 vehicles, and Chrysler Group LLC posted a 14 percent rise in August.
Chrysler sales were 148,472 vehicles, which the company said showed its best performance for August since 2007. Chrysler is managed and majority-owned by Italy’s Fiat SpA.
GM shares were down 0.5 percent at $21.25 at midmorning on Tuesday, and Ford shares were up 0.5 percent at $9.38. The broad S&P 500 Index was down 0.6 percent.
VW‘S BEST AUGUST IN 39 YEARS
The desire by consumers to replace older cars and trucks helped U.S. auto sales grow at a faster rate last month than the overall economy, said Carsten Krebs, head of communications for Volkswagen Group of America.
The U.S. economy grew at a rate of 1.7 percent in the second quarter.
Volkswagen turned in its best August U.S. sales performance since 1973, Krebs said, with the carmaker’s sales rising 62.5 percent to 41,011 vehicles.
Rising gasoline prices were a factor in consumers’ choice of vehicles in August, said Ken Czubay, Ford vice president of U.S. marketing.
“As fuel prices rose again during August, we saw growing numbers of people gravitate toward our fuel-efficient vehicles,” said Czubay.
Still, sales of its Fiesta small car fell 28 percent in August. Meanwhile, Focus compact car sales rose 31.5 percent.
Ford reported record sales for the Escape crossover and Fusion sedan, and said the F-Series pickup had its best sales month all year. Ford brand sales were up 13.1 percent, while Lincoln brand sales rose 1.7 percent.
U.S. auto industry sales should be 14.6 million new vehicles on a seasonally adjusted annualized rate, including medium and heavy-duty trucks, Chrysler said.
Taking out the medium and heavy trucks, that would be about 14.3 million light cars and trucks, compared with 14.1 million projected in July.
Economists polled by Thomson Reuters last week expected an August annualized sales rate of 14.2 million light vehicles, compared with 12.1 million vehicles on an annualized rate last August.
Analysts use the light vehicles sales figure as a key measure of the industry’s health.
Editing by Gerald E. McCormick and Matthew Lewis