Toy sales spring forward

NEW YORK (CNNMoney.com) -- Toy sales climbed in the first half of 2007 as new product innovations helped lift overall industry sales, a report released Friday said.

Retail sales for the toy industry rose 3 percent and produced over $8 billion in 2007, up from the $7.8 billion generated in 2006, according to research firm NPD Group.

Within the seven types of toys, known in the industry as seven super-categories, car toys saw the most growth with sales increasing 17 percent. Infant/preschool, youth electronics, plush, arts & crafts, building sets and games/puzzles also saw a modest gains, and combined the seven super-categories comprised over $4.5 billion in retail sales.

Action figures & accessories, and outdoor & sports toys both declined by 4 percent, while doll sales were flat, reversing a negative trend from last year. The research group expects to see a boost in sales of action figures due to the summer's box office hits that specifically target children and young teenagers.

"Based on NPD's research, parents believe toys are more interesting and stimulating than ever," Anita Frazier, an industry analyst with the NPD Group, said in a statement. "Taking this into account, along with strong sales during the first half of the year, the industry is heading into the all-important back half of the year in a very strong position."

Although the research group forecasts strong toy sales, on Wednesday the world's largest toy manufacturer Mattel (up $0.05 to $23.23, Charts, Fortune 500) recalled 1.5 million toys worldwide that were made in China for the company's Fisher-Price unit because their paint may contain too much lead. The recall is expected to cost the company about $30 million.