Keywords: Vehicles, consumer, replacement demand
Abstract: The motor vehicle industry has undergone important changes in recent years, including a shift in
production from autos to light trucks and growth of vehicle leasing. This paper uses household-level
data from the Federal Reserve's Survey of Consumer Finances to document changes in
households' acquisitions and financing of motor vehicles from 1989 to 2001. We examine what
types of vehicles households had, what financing arrangements were used to acquire them, and
how vehicle holdings vary with such household characteristics as income, age, wealth, and
creditworthiness. The data provide useful insights into the determinants of replacement demand
and the use of alternative financing arrangements like leasing.
Full paper (85 KB PDF)
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Last update: September 3, 2003