This came up at yesterday’s transportation panel and the point is worth making on the blog. Whatever you think about the likely medium-term outlook for the economy and whatever you think about the future of transportation policy in the United States, the market for new auto sales is definitely going to perk up sometime reasonably soon. To see why, look at this chart Calculated Risk posted a couple of weeks ago showing how long it would take the current fleet to turn over at the current rate of sales:
This chart is produced by taking the total number of registered vehicles in the U.S. divided by the sales rate. The numbers we’re at right now are not only way out of line with trends, but they’re way out of lines with the basic realities of American life. People’s vehicles aren’t going to last forever, and for the majority of people the inconvenience of carlessness is going to outweigh their recession-driven desire to reduce spending. Note that the US population continues to grow, making this look even less sustainable.