Gas Guzzlers Choking Drivers' Wallets
ARLINGTON. Va. -- It was bound to happen given the rising price of gas: American consumers are passing up SUVs and trucks for smaller, fuel-efficient cars.
The trend is visible in NAFCU's May Macro Data Report on Vehicle Sales, which cites that overall vehicle sales decreased from 15.1 million annualized units in March to 14.4 million in April. In the past 12 months, sales are down by 14%. The big three American manufacturers are losing share and Japanese competitors are benefiting.
NAFCU Staff Economist Katrin O'Connor found that even the sales increases for more gas efficient models aren't enough to boost overall car sales figures, which fell slightly from 7.5 million annualized units in March to 7.4 million units in April. Blame the overall weakened economy for that drop, as not just the price of gas, but of food has risen substantially.
Dr. Tun Wai, NAFCU's chief economist, noted that while gas-efficient cars are good for the environment and make sense in today's high-priced market, the credit union slice for auto loans may be impacted only slightly. "The need for new cars will continue and credit unions will finance members' auto loans, but the loan amounts won't be as high because SUVs and trucks cost more."
Sales are expected to pick up again in the last part of the year but are projected to remain below 16 million units.