Retail report shows car sales slump
TEXT OF STORY
Kai Ryssdal: And listen, not to pry, but what’re you doing with yourself this summer? I ask because it’s pretty clear not too many of us are spending a lot of time shopping. The Department of Commerce reported July retail sales this morning: down a 10th of 1 percent. In and of itself not a big number, especially considering high gas prices and worries about the economy. Oh, and the fact that we’re just not interested in one specific item. From New York, Marketplace’s Alisa Roth explains.
Alisa Roth: Americans just aren’t buying vehicles these days. Especially big ones.
David Healy:The most profitable vehicles, the big SUVs and the big pickup trucks are selling very poorly. They’re down something like 20-25 percent, in some cases 30 percent from July a year ago.
David Healy follows the auto industry for Burnham Securities. He says people are buying some vehicles.
Healy: Some of the smaller vehicles that get better mileage, particularly small passenger cars, are selling very strongly.
But overall, car and truck sales are down. And because SUVs cost a lot more than those little fuel-efficient deals, the total take is a lot less. Joel Naroff is chief economist at Commerce Bank. He says vehicle sales — or the lack thereof — really pulled on today’s numbers.
Joel Naroff And as a result of that, consumer spending is soft, but it’s not terrible and that’s what seemed to come out of July’s retail sales numbers.
People bought more furniture, housewares and electronics in July. Which more than anything points up the volatility of these monthly numbers: all those sectors were down in June. The price of goods we imported also went up in July. But just as lousy car sales pulled down retail sales, high oil prices pushed import prices up.
Get ready for more worrying inflation news: the government releases the consumer price index tomorrow and the producer price index next week. Naroff expects those numbers to be disappointing, too.
In New York, I’m Alisa Roth for Marketplace.
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