---

Auto Affordability Improves Again - Comerica Index

15 November 1999

Auto Affordability Improves Again - Comerica Index

    DETROIT, Nov. 15 -- The purchase of an average-priced new
vehicle during the third quarter of 1999 required 23.4 weeks of median family
income, before taxes, according to the Auto Affordability Index compiled by
Detroit-based Comerica Bank.  This compares with 23.6 weeks of income required
for purchase in the second quarter.
    During the same quarter a year earlier, a new vehicle purchase took 24.2
weeks of income, Comerica reported.
    The average vehicle price in the third quarter was $20,809.
    "Cars and light trucks are at their most affordable level in close to 20
years," said David L. Littmann, chief economist at Comerica.  "The current
23.4 weeks of required income rivals the average 23.1 weeks recorded in the
first quarter of 1980."
    Vehicles were more affordable in the third quarter because personal
incomes grew by 1.2 percent, while auto prices were unchanged, Littmann noted.
"This key factor also is driving this year's record vehicle sales pace," he
said.
    "Compared with the third quarter of last year, family incomes have risen
5.2 percent, and thanks to vehicle incentives and rebates, the average auto
transaction price is up only 1.2 percent," Littmann said.  Average auto
financing rates, at 7.45 percent, have remained nearly unchanged since last
year.
    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 nine other states.
Comerica also operates banking subsidiaries in Canada and Mexico.  Comerica is
celebrating its 150th anniversary in 1999.