Economy Watch: U.S. Auto Sales Up in 2013; Outgoing Fed Chair Optimistic
- Jan 06, 2014
Auto sales, long a pillar of the U.S. economy, dropped in December but enjoyed an increase in 2013, according to a WardsAuto estimate released on Friday. In December light vehicle sales came in at an annualized rate of 15.53 million units. That’s up 2.3 percent compared with December 2012, but down 4.8 percent compared with November.
At about 15.5 million units, total light vehicles in 2013 represented an improvement of 7.5 percent compared with 2012, when total sales were 14.4 million units. Last year’s total also inched closer to the totals recorded in the mid-2000s, which were consistently in the 16 million-vehicle range until sales dropped to a recession low of 10.4 million units in 2009. However, last year was the first year since 2010 when sales didn’t increase at a double-digit rate.
The Big Three, at least two of which had near-death experiences not so many years ago, saw solid sales in 2013, according to WardsAuto. Ford reported 2.44 million light vehicle sales for the year, up 10.7 percent, while Chrysler delivered 1.79 light vehicles in 2013, up 9 percent from 2012. General Motors sold 2.79 light vehicles last year, by 7.3 percent from the year before.
Soon to be Ex-Chairman Sounds Optimistic
In a speech at the American Economic Association in Philadelphia on Friday, outgoing Fed chairman Ben Bernanke sounded some optimistic notes about the U.S. economy in 2014. “The encouraging news is that the headwinds… may now be abating,” the chairman said. “Near-term fiscal policy at the federal level remains restrictive [that pesky sequester again], but the degree of restraint on economic growth seems likely to lessen somewhat in 2014 and even more so in 2015.”
Bernanke also noted that the “budgetary situations of state and local governments have improved, reducing the need for further sharp cuts. The aftereffects of the housing bust also appear to have waned.” More specifically, partly as a result of households’ improved finances, lending standards to households are showing signs of easing, though potential mortgage borrowers still face impediments, according to the chairman.
In short, “the combination of financial healing, greater balance in the housing market, less fiscal restraint, and, of course, continued monetary policy accommodation [some tapering plus those sweet low interest rates] bodes well for U.S. economic growth in coming quarters,” Bernanke said. “But, of course, if the experience of the past few years teaches us anything, it is that we should be cautious in our forecasts.”
Wall Street barely budged on Friday, with the Dow Jones Industrial Average inching up 28.64 points, or 0.17 percent, while the S&P 500 lost 0.03 percent and the Nasdaq was down 0.27 percent.