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By Rachit Vats
May 1 (Reuters) - Toyota Motor Corp and Fiat Chrysler Automobiles NV on Wednesday reported a fall in U.S. auto sales for April, as rising prices, higher interest rates and reduced incentives kept away buyers.
Although new-vehicle sales are expected to drop this year, major U.S. automakers now pin hopes on a robust economy and strong labor market to increase demand.
Toyota said its U.S. sales fell 4.4 percent to 162,506 vehicles in April, hurt by slack demand for its sedans, including Corolla and Prius.
Smaller rival Fiat Chrysler Automobiles NV too reported a 6 percent drop in sales in the United States, hurt by lower demand for its Jeep SUV brand and Dodge sedans.
"The industry may be shaking off the first quarter sluggishness, but shoppers are coming into showrooms and buying," FCA U.S Head of Sales Reid Bigland said. The No. 4 automaker in the U.S. said it sold 172,900 vehicles in April, compared with 184,149 units a year earlier.
The average price of a new car in the United States is expected to climb to $36,718 in April, the highest level seen so far in 2019, while interest rates hovered above 6 percent for the fourth straight month.
A weak demand is also pushing automakers' inventories higher, which may prompt companies to come out with consumer discounts as well as incentives.
"Slower April sales didn't do much to eat into the industry's mounting inventory levels, so we might start to see manufacturers and dealers begin to loosen the reins on incentives," Edmunds analyst Jessica Caldwell said.
General Motors Co, the No.1 U.S. automaker, said on Tuesday it was "bullish" on pickup truck sales for this year. The company said it already had inventories of Chevrolet Silverado pickup trucks for four months since April, which is seen as a high level in view of weak demand.
GM CFO Dhivya Suryadevara, however, said that the company's inventory would be brought down over the course of the year without offering heavy consumer discounts.
Last week, Ford said it was confident that its 2019 results would be better compared to the previous year.
U.S. auto sales are expected to be about 16.9 million units this year, a 2.2 percent fall from 2018, according here to industry consultants J.D. Power and LMC Automotive.
Reporting by Rachit Vats in Bengaluru and Nick Carey in Detroit; Editing by James Emmanuel