Story has been updated with opening prices for Ford and GM. NEW YORK (TheStreet) -- October has been a choppy month for stock markets, but for auto sales -- another key economic indicator -- a long-term recoveryakeeps rolling along even as concerns about excessive incentivesaand unsustainable pricing levels mount. Forecasters predict sales growth of 5% to 6% from the same month a year earlier, and LMC Automotive forecasts total 2014 light-vehicle sales of 16.4 million. Auto sales have climbed steadily since they hit a 27-year low of 10.2 million in 2009, reaching 15.6 million in 2013. Must Read: One in Four Americans Fears Travel Because of Ebola, Poll Shows Improved sales are not the whole story. Auto pricing is also at record levels, fueled perhaps by the rising level of incentives. "The U.S. market is strong when using sales as a measure, with new-vehicle retail sales through the first nine months of 2014 at their highest level since 2005," according to a recent analysis by J.D. Power. "Simultaneously, the industry has also enjoyed unprecedented growth in the average transaction price of new vehicles, rising to more than $29,600 thus far in 2014 from $25,700," the firm said. However, Kelley Blue Book analyst Alec Gutierrez noted that "one cause for concern is the rising levels of incentive spend in the industry, which in recent months has drifted close to an average of $3,000 per vehicle. "The ratio of incentive spend to average transaction prices is at its highest since 2010, but remains below pre-recession levels," Gutierrez said in a prepared statement. "Since inventory levels have remained consistent, this isn't a red flag quite yet, but it does underline that the natural industry growth we've had in recent years is slowing." Moreover, on earnings calls last week, both Ford and GM executives warned of U.S. pricing weakness. Credit Suisse auto analyst Daniel Galves subsequently lowered his target price for Ford to $13.50. Shortly after the opening bell on Tuesday, Ford shares traded at $13.89, up seven cents but down 10% for the year. "Pricing on Fiesta, Focus, Fusion, Escape was down 5% in 3Q14, a potential $1 billion annualized headwind," Galves wrote in a report. Meanwhile, GM shares traded up 21 cents at $30.29, down 26% for the year. For October, Kelley Blue Book projects U.S. light-vehicle sales in October will gain 5.4% while TrueCar forecasts 5.9%. J.D. Power affiliate LMC Automotive forecasts 6%. "The current environment of the auto industry is one of strength and stability, with the second half of the year at a 16.6 million-unit pace, more than making up for the 16.1 million unit level in the first half of 2014," said LMC analyst Jeff Schuster in a prepared statement. Must Read: Ebola Isn't a Problem for Airlines But Delays from Ebola Scares Are Kelley Blue Book and TrueCaraexpect a seasonally adjusted annual sales rate of 16.3 million, up from 15.3 million in October 2013 and even with 16.3 million in September 2014. TrueCar is forecasting that Fiat Chrysler sales will gain 19%, leading the industry. "Once again, the majority of its growth is attributed to the Jeep Cherokee, which launched late last year," the firm said. "If you exclude the Jeep Cherokee, Fiat Chrysler's impressive growth in 2014 drops from 14.7% to 5.2%." TrueCar forecasts a 12% gain for Nissan , with Toyota aup 6%, Honda up 5%, GM up 4% and Ford down 3% as it continues to manage F-150 inventory in preparation for the sale of the 2015 model, creating opportunities for Fiat Chrysler and GM. "Fiat Chrysler's growth, fueled by Jeep and Ram, has set up a dogfight this month, with FCA, Ford and Toyota battling for second place behind GM in total volume," said TrueCar President John Krafcik in a prepared statement. -- Written by Ted Reed in Charlotte, N.C. To contact this writer, click here. Follow @tedreednc
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