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FACT BRIEF

Are pickup truck sales meaningful indicators of economic growth in the states?

Tuesday, November 10, 2020
By Christopher Hutton
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YES

Economists have found that light-truck sales numbers, while not a perfect indicator, often reflect the state of the U.S. economy overall, largely because of their connection to home construction.

During the 1994-2006 period, pickups generally made up just over 18% of all sales of new light vehicles each year, according to TD Economics. That percentage only dropped below 18% in 2006, when the housing market began to go south. Pickup sales continued to drop until hitting bottom in 2009. A "construction rebound" began in 2013, and pickup sales grew by 11.7% that year.

DataTrek observes that pickup sales between 2015 and 2019 seemed to demonstrate "the same slow but steady growth" of most small businesses. "For them, purchasing a new vehicle is entirely discretionary; they can always fix the old one and keep it running another year if they are worried about business conditions."

This fact brief is responsive to conversations such as this one.
Sources
TD Bank: US auto sales basking in their comeback glow
Washington Post: How truck sales track the economy
DataTrek: Pickup sales as economic indicator
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Fact briefs are short, credibly sourced summaries that offer “yes/no” answers in response to claims found online. They rely on publicly available, often primary source data and documents. Fact briefs are created by contributors to Gigafact —a nonprofit project looking to expand participation in fact-checking and protect the democratic process. See all fact briefs here.