Better Mileage, Good Financing Leads to More Car Sales According to the latest BIGresearch survey, consumers look at gas prices and 30-year conventional mortgage rates and conclude
refinance and buy a new car.
Slightly less than half of all respondents say higher gas prices are having no major impact on their spending outlook. Despite higher bank-to-bank
borrowing rates, and higher gas prices, the current monetary and credit system is relatively unaffected by the recent upward move in oil and gas prices.
Richard Hastings of The RDH
Company and a BIGresearch Associate, says "Domestic gas inflation leads to renewed efforts to maintain U.S. dollar-Yuan peg rate in order to prevent imported discretionary goods prices from
rising. This makes today's gas inflation almost meaningless to domestic monetary policy. It does, however, …encourage policy makers to focus on price stability which, in today's macroeconomic
language equals imports and deficits."
How
Fluctuating Gas Prices Impact Consumer Spending (multiple selection ok) |
Delayed major purchase such
as car, TV, furniture | 14.4% |
Reduced dining out | 24.7% |
Decreased vacation/travel | 28.4% |
Increased carpooling | 4.6% |
Spending less on groceries | 14.6% |
Spending less on clothing | 21.0% |
Other | 7.5% |
No major impact | 48.7% |
Source: BIGresearch |
Consumers continue to use higher gas prices, and allegedly
inadequate mileage, to justify more expenditures on new vehicles. Consumers are saying they are going to borrow again long-term (maybe 72-month auto loans) in anticipation of much higher gas prices.
Motivation To Purchase A New Vehicle (multiple
selection ok) |
Financing deals/incentives were too good to pass up | 14.3% |
Lease was up | 4.8% |
Old car had high mileage | 35.2% |
Old car was always in the repair shop | 20.4% |
Tired of old car; I wanted something
new | 22.0% |
Wanted a vehicle
with new "tech toys" (GPS, DVD, etc.) | 6.2% |
Wanted a vehicle with better gas mileage | 19.2% |
Wanted a vehicle with better safety features | 14.6%
|
Like the style of the new models |
15.0% |
My significant other wanted a new car | 11.9% |
Needed another car for my family | 14.0% |
Old car "died" | 17.6% |
Needed more room | 9.0% |
Other | 17.0% |
Source: BIGresearch |
The sum of the % totals may be greater than 100% because the respondents can select more than one answer.
You can find out more here.