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Vehicles at Most Affordable Level Since 1980 - Comerica Index

10 August 2000

Vehicles at Most Affordable Level Since 1980 - Comerica Index

    DETROIT - The purchase of an average-priced new vehicle during the second 
quarter of 2000 required 23.0 weeks of median family income, before taxes, 
according to the Auto Affordability Index compiled by Detroit-based Comerica 
Bank.  This compares with 23.3 weeks of income required for purchase in the 
first quarter.  During the second quarter a year earlier, a new vehicle purchase 
took 24.5 weeks of income, Comerica reported.

    After rebates and discounts, the average price paid by consumers for a
vehicle in the second quarter was $21,792 -- 2.1 percent below year-earlier
prices.

    "Currently we are seeing the most affordable combination of price and
financing since the first quarter of 1980, when a new vehicle purchase
required 22.9 weeks of work," said Comerica chief economist David L. Littmann.
"Despite the nearly half-point increase in financing rates from a year ago,
the key to auto affordability improvement in the latest quarter was the
impressive 6.5 percent gain in median family income over the same period."

    Comerica's Auto Affordability Index is compiled from Commerce Department
and Federal Reserve data.

    Comerica Bank, the largest bank in Michigan, is a subsidiary of Comerica
Incorporated , a multi-state financial services provider
headquartered in Detroit, with banking subsidiaries in Michigan, California
and Texas, banking operations in Florida, and businesses in several other
states.