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Economy in Brief

U.S. Light Vehicle Sales Benefit From "Cash For Clunkers" Program
by Tom Moeller August 3, 2009

The U.S. government's "Cash for Clunkers" program was given credit for supporting sales of light vehicles last month. The program gives car buyers up to $4,500 for trading in older, gas-guzzling vehicles if they're buying more fuel efficient cars. The Treasury Dept. was authorized to spend $1 billion and an additional $2 billion currently is under consideration by the Senate. The House passed its approval of the plan on Friday. One estimate is that, just last week, the program helped spike vehicle sales to a 15-to-16 million annual rate. Regardless of the program's impact, U.S. light vehicle sales last month jumped 15.8% from June to 11.24 million units (AR) which was the highest sales rate since last September. It followed a 1.6% decline during June. While sales were firm last month, they remained down by nearly one-third, year-to-date, from the first seven months of 2008. (Benchmark revisions altered sales levels slightly back to 2002.)

Unit sales of U.S. made light vehicles jumped 15.8% m/m to 8.17M units during July which was their highest since last September, according to the Autodata Corporation. (Seasonal adjustment of the figures is provided by the U.S. Bureau of Economic Analysis). Sales of domestically made cars jumped 25.4% m/m to 4.11M units while light truck sales rose 7.4% m/m to 4.06M units. YTD, sales of domestic vehicles overall are down 33.6% following last year's 35.8% drop from December-to-December.

In similar fashion, sales of imported light vehicles were strong and rose 16.0% m/m during July from June. Sales of imported autos rose 18.3% from June and were at their highest level since last August. Sales of imported light trucks were nearly as strong m/m, up 11.3% from June, but they've really been strong all year rising to their highest just since March. Sales of imported vehicles YTD have increased 12.5%.

Overall, import's share of the U.S. light vehicle market held steady at 27.3% last month after reaching 26.5% during all of last year. (Imported vehicles are those produced outside the United States.) Imports' share of the U.S. car market totaled 33.7% while the share of the light truck market was 19.5%, up slightly from last year.

The U.S. vehicle sales figures can be found in Haver's USECON database.

Light Vehicle Sales (SAAR, Mil. Units) July June May July Y/Y 2008 2007 2006
Total 11.24 9.70 9.86 -11.4% 13.17 16.16 16.54
  Autos 6.20 5.04 4.89 -10.7 6.71 7.58 7.77
    Domestic 4.11 3.28 3.19 -7.0 4.42 5.07 5.31
    Imported 2.09 1.76 1.71 -17.3 2.29 2.52 2.45
  Light Trucks 5.04 4.66 4.37 -12.2 6.47 8.60 8.78
    Domestic 4.06 3.78 4.05 -12.6 5.29 7.10 7.42
    Imported 0.98 0.88 0.92 -10.4 1.18 1.47 1.37
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