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Home Publications Blogs Beat the Press Car Sales are Up, Compared to What?

Car Sales are Up, Compared to What?

Wednesday, 02 February 2011 05:56
The media touted the 17 percent increase in January car sales compared to the level reported for January 2010. It is not clear that this implies a very good month, since sales were quite weak in January of last year. The 800,000 level of sales estimated for January is a decline of 17.5 percent from 970,000 average monthly sales for the fourth quarter of 2010. If this sales rate continues through February and March then car sales will be a major drag on GDP growth for the quarter.
Comments (4)Add Comment
written by Mark, February 02, 2011 9:20
As the chart from Calculated Risk shows, auto sales are down approx. 30% from Jan. 2006. My quick math tells me there are over 7 million new drivers added over the last 5 years. Recovery?
Bad data
written by PeakVT, February 02, 2011 10:05
The 17% figure is for the y/y SAAR (seasonally adjusted annual run rate) and it is the correct percentage. SAAR is the number the media always uses and they are very consistent about it. What GM was referring to is not clear from the snippet I can see. But if it was actual sales then it is somewhat meaningless as actual numbers are not widely known and so there is nothing to compare GM's number with.
written by PeakVT, February 02, 2011 10:10
Mark - sales numbers were distorted by the boom and they will probably not reach that level again anytime soon. See this graph: http://picasaweb.google.com/lh...directlink
written by John Houston, February 02, 2011 11:27
Dr. Baker,

Do you or does anybody expect houses or cars to begin
selling at "pre-recession" levels until the housing bubble is mitigated ? As you have mentioned, the US
govt had to basically give money to people to buy either
houses or cars with the homebuyers credit and clunkers programs.

It does not appear as if any political force is pushing for any solution to the demand problem.
What do you foresee ?

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.