Beige Book Points to Higher Auto Sales

Economic conditions are on the mend, and new- and used-vehicle sales have started to pick up.

That was the word from the 12 Federal Reserve Districts as indicated in the Beige Book report released yesterday.

In all, eight districts reported some increase in activity or improvement in conditions. The remaining four indicated that conditions had either changed little or were mixed. The 12 districts are Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco.

Here are some of the Beige Book’s auto-related highlights:

• Consumer spending was reported to have picked up moderately since the last report, for both general merchandise and vehicles; a number of Districts noted relatively robust sales of used autos.
• Auto sales generally improved since the last report, in some cases rebounding from a brief dip after the “Cash for Clunkers” program ended. Increased vehicle sales were reported from New York, Philadelphia, Richmond, Chicago, St. Louis, and Dallas, while sales were described as flat or mixed in the Cleveland, Minneapolis, Kansas City, and San Francisco Districts. A number of Districts reported that used vehicles have been selling better than new ones.
• Auto dealers’ inventories, largely depleted during the Cash for Clunkers program, have been or are being rebuilt.

As for financial services, banks generally reported “steady to weaker loan demand, continued tight credit standards, and steady or deteriorating loan quality.”

Click here for the full report.