DETROIT – Shares of AutoNation, Group 1 Automotive and different automotive sellers rallied Thursday following robust third-quarter earnings and optimistic outlooks relating to shopper demand for brand new autos.

The outcomes and feedback adopted considerations by some Wall Road analysts that the trade might quickly shift from a list provide drawback to an absence of demand, or “demand destruction,” state of affairs with rates of interest rising, inflation at document highs and recession fears looming.

“Clearly, there’s some normalization that is going to happen and has occurred,” Group 1 CEO Earl Hesterberg informed traders after the corporate beat Wall Road’s expectations on Wednesday. “However we have no large trepidation about subsequent yr … our core companies akin to aftersales and new car gross sales are shifting to stay robust within the near-term.”

Shares of AutoNation had been up by as a lot as 8.2% after the corporate beat Wall Road’s estimates on Thursday. Shares of others akin to Group 1 Automotive and Penske Automotive that reported third quarter outcomes on Wednesday had been up by greater than 6% throughout intraday buying and selling on Thursday.

Hesterberg’s optimistic feedback echoed these of different executives, who signaled provide chain issues are prone to preserve new car inventories tight for the foreseeable future. Stock ranges of latest autos through the third quarter elevated however they remained traditionally low.

Normal Motors and Ford Motor this week additionally stated they noticed shopper demand holding robust through the third quarter, however warned they’re carefully watching outdoors financial components and considerations for any adjustments.

“We’ve not seen any direct affect on our merchandise. Pricing stays robust, demand stays robust for our merchandise, however we will not ignore what others are saying on the market and what others are seeing on the market,” GM CFO Paul Jacobson informed reporters Tuesday after reporting robust third-quarter earnings.

Automakers and retailers consider they’ve higher insights into shopper demand than they ever have earlier than, as the businesses have centered extra on particular person, personalized retail orders, together with buyer reservations, moderately than folks shopping for autos off vendor tons.

The trade is coming down from document income through the coronavirus pandemic, and is dealing with decrease wholesale used automobile costs, slowing new car value will increase and different indicators of broad normalizing on the heels of the pandemic and provide chain points.

Car gross sales for a number of dealership teams had been in step with or decrease than the third quarter of final yr, which some stated was attributable to continued manufacturing issues.

Additionally notably decrease had been common used car gross income per unit, or GPU. The typical GPU – an vital statistic for traders – for used autos largely declined double digits in contrast with a yr earlier, together with declines of greater than 20% for Group 1 and AutoNation.

AutoNation CEO Mike Manley informed traders Thursday that he expects “some mitigation in margins as we get middle-to-end of subsequent yr,” however demand is “nonetheless going to stay wholesome.”

Group 1 stated its order banks for brand new autos is at practically 17,000 models, which represents a backlog of six months based mostly on its 2022 gross sales tempo. Nevertheless, Lithia CEO Brian DeBoer final week stated whereas demand stays robust, the corporate would not “have the greater backlogs that we used to have.”

The features in vendor shares on Thursday follows much less optimistic feedback from used automobile retailer CarMax in addition to Lithia Motors, which is battling AutoNation this yr for the title of nation’s largest vendor, lacking Wall Road’s prime and bottom-line expectations final week.

Here is a have a look at how auto vendor shares are acting on Thursday:

–CNBC’s Michael Bloom contributed to this report.