The last physical quarter of 2011 saw the best car affordability since 2009’s third quarter, according to a report just released by Comerica Bank. The lowering of auto prices, along with consumers’ improved credit scores, have many in the auto industry predicting that 2012 will be a strong year for auto sales.
The average new car price last quarter was 4 per cent less than the average price 12 months before. This pencils out to an average new car price of $1,050 less than last year’s. In total, the average cost of purchasing and financing a new car last quarter is equal to 23.1 weeks of a median family’s income. More consumers are qualifying for both new and used car auto loans due to better credit ratings.
Explaining the reemergence of the auto consumer, Robert Dye, Chief Economist of Comerica Bank in Dallas, said, “Auto affordability improved at the end of 2011, boosted by gains in personal income that were, in turn, supported by stronger job creation.”