Think new cars are more expensive now? Sorry, it's just an illusion.
According to the American Automobile Manufacturers Association, buying a car in 1998 takes the same size chunk, on a percentage basis, out of the family budget as it did 13 years ago.That would be 22.8 weeks of the median annual family income (down from 23.5 weeks a year ago) or about where it was in 1985, says the second quarter report of the AAMA, based in Washington, D.C.
The report, published Wednesday, also indicates that the penetration of imported cars into the U.S. market has been halved over the past 11 years, from a record high of 31.1 percent in 1987 to only 15.5 percent in April, May and June of this year.
Sales of imported cars from Japan totaled just 181,729 units, or 7.8 percent of total car sales. That does not include "imports" made in this country, such as Hondas produced in Ohio, Toyotas in California, and others.
Interest rates charged by finance companies on new car loans declined on average to 6.1 percent in the second quarter, the lowest on record.
Employment in the auto industry totaled 1.005 million jobs in the quarter, the highest level since 1978.
Automobile production during the quarter was down 13.1 percent from the same period last year to a seasonally adjusted rate of 5.0 million units. Truck production, which includes many sport-utility vehicles, was up 5.6 percent over the second quarter of 1997 to an adjusted rate of 6.2 million units.
Total motor vehicle production was down 3.6 percent in the quarter to 11.2 million units.
But though production was down, sales of passenger cars moved up in the quarter to an annualized rate of 8.4 million units, well above the 8.0 million sold in the year-ago quarter. Truck sales totaled 8.2 million units, the tenth consecutive quarter in which truck sales have been higher than the same quarter in the previous year.
Total vehicle sales in the U.S. was 4.5 million units, 439,000 more than a year ago.
Ford was the most profitable domestic automaker in the second quarter with profits of $2.4 billion. Chrysler was second with $1.0 billion. General Motors earned only $389 million.
Industry analysts expect U.S. motor vehicle sales to be flat this year at 15.3 million to 15.5 million units sold and 1999 retail sales to be about the same.