Bob Carlson

February 26, 2013

Why Car Sales Are Booming

Filed under: Cash Management — Bob @ 9:30 am

Automobile sales have been driving higher retail sales and higher consumer credit, and are part fo the reason for the growth in manufacturing after 2009. I recently bought a new car and can vouch for what Barry Ritholtz says in this post. Car prices haven’t changed much in the last few years and actually seem to have declined for comparable models in 2008-2009. But financing is what’s really making cars more affordable and stimulating purchases. I don’t know how long this will last, but the Fed’s zero interest rate policy is making this a very good time to replace or upgrade your vehicles.

As it turns out, I was stunned at the bargains available across all price points.

We lease our cars through the office. By dumb luck, I have two cars coming up within 30 days of each other. I am the spendthrift, while Mrs. Big Picture is the one who reins in my attempt at single-handedly reviving the American economy.

To give you an idea of how things have changed — all due to interest rates — the same monthly payments for leases now buys you about 25%-33% more car for your buck. Financed purchasing power gives you almost as much gains for your buy relative to 3-4 years ago.

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