In the fourth quarter of 2001 consumer spending grew at an estimated annual rate of more than 4%, partly thanks to discounting and zero-rate financing for car purchases.
This assumption was based on the stable underpinnings of auto demand--cheap financing by car companies (and by home equity loans) and a customary replacement cycle of three years.
So in 1992 Morris got rid of all 18 used-car lots to focus solely on financing used-car sales made by others.
The auto industry selling rate now holds over 14 million in a firm used car market, low cost consumer financing and the aging car population.
Ally Financial in Detroit, Mich. is introducing an innovative new-car financing program that allows owners to sell their vehicles back to Ally at a guaranteed price after 48 months.
The effects of October's zero interest-rate car-financing programmes continue to be seen in America's economic data.
In the United States, anywhere from 73% to 91% of new car purchases involve financing.
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Boosted by yet another bout of cheap financing offers from Detroit, July car sales could set a record.
What Jackson and AutoNation did was understand better than their competitors the root drivers of car demand: cheap financing and a short replacement cycle.
Because each week's recipients were selected at random, the survey, taken as a whole, automatically negated the effects of other temporary influences on spending, such as changes in the stock market or car makers' cheap financing deals.
Electric car makers have struggled with financing and profitability given the costs of developing new technology and difficulty achieving economies of scale.
And car companies have relied on cheap financing rates to maintain sales.
If a car company offers you a choice of 0% financing, a discounted lease or a rebate, which are you likely to take?
In a 2005 article, one dealer is quoted as stating that his repossessions dropped from 45% to 15% and allowed him to make car sales to buyers who would normally be shut out of financing options.
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Fourgeaud, 32 and Kallio, 33, are also on the hunt for Series A financing, but potential investors will note that neither come from the world of car making, with Fourgeaud steeped in mobile and social media, and Kallio primarily a brand designer.
"The new entrants, with their marketing and financing capabilities, are likely to add further impetus to growth in the small-car segment, " says Shripad Bhat, assistant director of the Association of Indian Automobile Manufacturers (AIAM).
He said his car was stopped after a meeting in Zurich with some business associates about a film financing project.
Ford is also trying to drive car sales by offering competitive pricing and incentives such as cash rebates and zero-percent financing to win over customers from other competitors such as Toyota.
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