Working Paper

The replacement demand for motor vehicles: evidence from the Survey of Consumer Finances


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.

Keywords: Automobile industry and trade - Finance; Consumers; Consumer behavior;

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Bibliographic Information

Provider: Board of Governors of the Federal Reserve System (U.S.)

Part of Series: Finance and Economics Discussion Series

Publication Date: 2003

Number: 2003-44