Life gets more expensive with each passing day… but maybe not in the car business.
Americans paid a smaller share of their household income for vehicle purchases last year than they did in 1989, according to a study released last week by two University of Michigan researchers.
In 1989, households spent 8.4 percent of their available income buying cars and trucks. Last year, they spent just 6.9 percent.
Does that indicate lower sticker prices today? Hardly. Has there been a trend toward Americans buying econo-boxes? Are you kidding?
The Michigan researchers found that since the late-1980s, when Chevrolet Corsicas and Plymouth Acclaims were big sellers, household incomes have risen. Americans today spend relatively less on cars, food, clothing and cigarettes than they did in 1989, while shifting bigger percentages into health care, insurance and housing.
The study also found that households spent a smaller share of their income on vehicle-related costs — gasoline, oil changes, repairs — last year than they did in 1989.