Major auto suppliers blew past profit expectations on Friday, suggesting the recovery in the global auto market remains strong despite rising oil prices and the disaster in Japan.

Goodyear Tire & Rubber Co , powertrain maker American Axle and Manufacturing Holding Inc and Lear Corp , which makes seating and electrical power management systems, posted first-quarter earnings that easily exceeded Wall Street estimates on improving global demand.

What we're seeing from these results is the volumes are significantly higher and therefore the recovery in the auto industry is gaining momentum, said Tim Ghriskey, chief investment officer with Solaris Asset Management.

Clearly, the sales are doing well and the consumer is replacing older vehicles, added Ghriskey, who has owned auto stocks in the past and still follows the sector closely.

Shares of Goodyear, American Axle and Lear were up 10.9 percent, 3.3 percent and 2.5 percent, respectively, in morning trading.

Lear cited a 5 percent increase in global auto production in the first quarter compared with a year earlier. Demand grew around the world, offsetting a 32 percent production decline in Japan due to the earthquake and tsunami last month.

Friday's earnings reports continued a strong week for the sector, underlined by Ford Motor Co's better-than-expected profit.

Other suppliers whose results topped expectations this week included BorgWarner Inc , Federal-Mogul Corp and Dana Holding Corp .

Dealer groups -- AutoNation Inc , Penske Automotive Group Inc

, Asbury Automotive Group Inc and Group 1 Automotive Inc -- also posted strong profits, although many warned the Japanese crisis would crimp vehicle inventories on their lots.

Obviously, it's all about volume, Morningstar analyst David Whiston said. With a lower fixed cost and a better top line, it's not a surprise to see earnings doing so well.

While he still expects some choppiness due to the Japanese crisis, he said the industry's recovery remains in place.

David Silver, analyst with Wall Street Strategies, cautioned against exuberant expectations, however.

I wouldn't call it a party right now. It's more of a get-together, he said. The profitability of the North American automakers is much improved from 2007 and 2008, but the Japan disaster is an overhang.

Silver expects more of drag on automaker and supplier earnings later this year.

That squared with comments from General Motors Co Chief Executive Dan Akerson, who said on Thursday that the Japanese crisis was a second-quarter event.

Akerson, like Ford CEO Alan Mulally, said the disaster in Japan was not likely to have a great impact on earnings.

Silver also said the European market will be weak for the year, while Ghriskey voiced concern about rising raw material costs.

(Additional reporting by Bernie Woodall; editing by John Wallace)

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