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General Motors is optimistic that this is the year you cut loose and buy new.
Despite the fact that the aging of vehicles on the road has coincided with the auto industry's significant decrease in new car sales during the nation's recession, GM spokesman Tom Henderson says pent-up consumer demand will drive new car sales higher as the economy recovers.
According to the R.L. Polk & Company research firm, over the past 15 years there's been a steady increase in the average age of vehicles. In 2010 the average age was 11 years old, up more than 2.5 years from the 8.4 year-old average reported in 1995.
Americans are holding on to their cars longer for the simple reason that drivers find it cheaper to fix an old car than buy a new one. Additionally, with the economy stuck somewhere between reverse and neutral, rational people are uncertain about their employment and afraid to take on more sizable car payments, especially if they've recently lifted that burden from their financial obligations.
"Anyone that thinks it's wise to swap out of a new vehicle every three to five years is probably going to find that they're leaving money on the table, as opposed to trying to extract the maximum value of that vehicle," said Alec Gutierrez, manager of vehicle valuations for Kelley Blue Book in a recent interview with the Detroit Free-Press.
We're also holding on to our cars longer because they're made better and last longer. Auto manufacturers are producing better vehicles and offering longer and more comprehensive warranties.
Nonetheless, FOX Business News suggested today that many of us driving those 11-year old vehicles may be reaching a point where long postponed repairs are just about due--and when that happens, we'll be pulled toward the 2012 and 2013 models promising much greater fuel economy.
Do you agree?