DETROIT, Feb. 12 /PRNewswire-FirstCall/ -- The purchase of an average- priced new vehicle took 26.2 weeks of median family income in the fourth quarter, according to the Auto Affordability Index compiled by Detroit-based Comerica Bank. That 2.2 rise in the number of weeks of work required to purchase a new vehicle was the biggest one-quarter deterioration in affordability ever recorded by the index. The sharp drop in affordability in the fourth quarter reversed most of the improvements in affordability recorded over the prior three quarters. Including finance charges, the total cost of buying an average-priced light vehicle was $29,400 in the fourth quarter, up three percent from a year ago. Median family income rose about four percent over those same four quarters.
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"The average amount spent on a new car jumped by more than $1,000 in the fourth quarter," said Dana Johnson, Chief Economist at Comerica Bank. "With gasoline prices down sharply and wage and salary incomes showing healthy gains, consumers opened their wallets when shopping for cars and light trucks. That along with a rebound in financing costs reflecting less generous incentive programs resulted in a sharp deterioration in our affordability index in the fourth quarter."
This report incorporates the latest data on consumer spending on light vehicles and on the terms available on auto loans. The entire history of the index is shown in the chart below and is available upon request from Marsha Halliburton (313-222-4568 or mlhalliburton@comerica.com).
Comerica Incorporated (NYSE: CMA) is a financial services company headquartered in Detroit, strategically aligned by three business segments: The Business Bank, The Retail Bank, and Wealth & Institutional Management. Comerica focuses on relationships and helping businesses and people to be successful.
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Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20010807/CMALOGOSOURCE: Comerica Incorporated
CONTACT: Media, Dana Johnson, Senior Vice President and Chief Economist,
+1-734-930-2401, or djohnson@comerica.com, or Data, Marsha Halliburton, Data
Analyst, +1-313-222-4568, or mlhalliburton@comerica.com, both of Comerica
Incorporated
Web site: http://www.comerica.com/
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