Auto Affordability Remains Steady, Comerica Reports

DETROIT, May 12, 2003 -- The purchase of an average- priced new vehicle during the first quarter of 2003 took 20.0 weeks of median family income, before taxes, according to the Auto Affordability Index compiled by Detroit-based Comerica Bank. The latest Auto Affordability Index reading is unchanged from fourth quarter 2002.

"Steep incentives continue to hold auto affordability at 24-year records," said David Littmann, chief economist at Comerica Bank.

"Auto prices and family incomes rose at nearly the same rate during the first quarter 2003, so were it not that car buyers on average lengthened the terms of their auto loans by nearly two months, it would have been difficult to offset the nearly one full percentage point jump in financing rates."

The total cost of an average-priced new vehicle -- including financing charges -- came to $25,197 in the first quarter, a 1.1-percent rise from fourth quarter 2002, but 0.2 percent below year-earlier levels.

Comerica's Auto Affordability Index is compiled from Commerce Department and Federal Reserve data. The index fully reflects Commerce's data revision since 1999.

Comerica Bank, Michigan's oldest and largest bank, is the lead subsidiary of Comerica Incorporated , a multi-state financial services provider headquartered in Detroit, with banking subsidiaries in Michigan, California and Texas, banking operations in Florida, and businesses in several other states.