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1997 Auto Affordability Best Since 1980 - Comerica Bank Index

23 February 1998

1997 Auto Affordability Best Since 1980 - Comerica Bank Index

    DETROIT, Feb. 23 -- The purchase of an average-priced new
vehicle during 1997 required 26.1 weeks of median family income, before taxes,
according to the Auto Affordability Index compiled by Detroit-based Comerica
Bank.  This compares to the 27.2 weeks of income required for the purchase in
1996.
    "Last year, vehicles were at their most affordable level since 1980, when
new vehicle purchases absorbed an average 23.5 weeks of income," said David L.
Littmann, senior economist with Comerica Bank.  "The rapid rise in median
incomes during 1997 merged with stable vehicle prices to bring about a
consumer-friendly buying environment.  This resulted in a huge improvement in
affordability over 1996."
    In 1997, aggressive incentive activity and rebates held average auto
prices stable, Littmann said, and median family income rose by a robust
6 percent between the fourth quarters of 1996 and 1997.
    Weeks of median family income required to purchase the average-priced new
vehicle, before taxes, according to Comerica's Auto Affordability Index:

    1997        4th quarter        26.0
                3rd quarter        26.1
                2nd quarter        26.2
                1st quarter        26.2
                Annual average     26.1

    1996        4th quarter        27.1
    1996        Annual average     27.2
    1995        Annual average     28.4
    1985        Annual average     28.4
    1980        Annual average     23.5
    1975        Annual average     22.3

    Comerica's Auto Affordability Index is compiled from Commerce Department
and Federal Reserve data.  Graphic detail available upon request.
    Comerica Bank is the lead subsidiary of Comerica Incorporated ,
a diversified financial services provider headquartered in Detroit with
banking affiliates in Michigan, California, Texas and Florida.

SOURCE  Comerica Incorporated