Average length of U.S. vehicle ownership hit an all-time high
The latest data compiled by global market intelligence firm R.L. Polk & Co has found that Americans are now holding onto their new vehicles for a record 71.4 months. On the used vehicle side, that interval has risen to 49.9 months, a figure that also represents a new high mark. Collectively, the ownership period currently stands at 57 months, up from about 38 months back in 2002.
Polk sees several main drivers behind this extended ownership trend. For openers, the continuing soft economy and high unemployment rates are impacting purchase decisions of many would-be buyers; and those who do make the move often finance the deal over a longer period of time to reduce the size of their monthly payments. The fact that improved build quality and durability of modern cars and trucks makes it less risky to hold onto a given vehicle for a longer time period also factors into the equation, especially since a number of manufacturers now offer basic warranty coverage with extended terms.
Polk believes that it will be at least 2015 before the annual sales volume in the U.S. auto industry will once again hit the 16-million level achieved prior to the current downturn. While projecting that the encouraging upward trend in new-vehicle sales will help reduce the average ownership period in the long run, Polk still foresees the turnaround process as likely to require several years. Last month, a corollary Polk research study found that the average age of the passenger car and light truck fleet in America has now reached an all-time high of 10.8 years.