Consumer vehicle markets are expanding in the US early in 2014, bolstered by the sales of light trucks which are up 12.7% over April of 2013 and 15.4% year to date from 2013. The SUV/Cross-over market is also up 10.1% year to date. The strong sales may be a reaction to a historically brutally cold winter throughout swaths of North America. The car market, contrary to the overall trend, is down 1.8% YTD from 2013.According to a Ford economists, the car market is also expected to expand in 2014; consumers are expected to more than make up for the slow sales through the first three months of the year over the next nine. Indeed, April car sales are up 3.6% over sales in April of last year.
Source: www.motorintelligence.com
The projections of increasing growth in the American auto industry are promising. The purchase of new cars stimulates many other sectors due to the numerous complementary goods. Perhaps the spike in new cars sales could lead to increased overall growth in the economy, spurring along some of the other industries that have been stagnant thus far in 2014. Hey, maybe even Tesla will see a bump from this, and if so I know who will be the first to let us know.
What slides did Dr. Traub show when we were at the Fed? Would they support (or undermine) this conclusion of a strong market. I also wonder whether breaking pickups into small- and large-sized ones would convey a stronger picture?
What of this winter? Are there seasonal effects as well?
As to the “macro” multiplier, in what states is auto empoyment high? Are any of these places where labor markets are slack, so that if a firm sought to expand (or a group of workers were made to feel secure), they could hire (retain) workers?