84.5 percent of consumers used a loan or a lease to purchase a new vehicle in second quarter
Experian Automotive report shows consumers are relying on automotive financing more than ever before
SCHAUMBURG, IL--Sept. 3, 2013: Experian Automotive today announced that a record 84.5 percent of consumers who acquired a new vehicle in the second quarter obtained either a loan or a lease to fund the purchase. According to the latest State of the Automotive Finance Market report, new vehicle financing is at the highest level since tracking began in 2006. This metric is up from 82.5 percent in Q2 2012 and from 79.7 percent prior to the recession in Q2 2008.
"Loans have become more accessible in recent years, and we've seen a steady growth in the percentage of consumers financing their vehicles," said Melinda Zabritski, senior director of automotive credit for Experian Automotive. "Obviously, this is good news for the auto industry, but it's also good for consumers because this, combined with the reduction we have seen in delinquencies, shows that they are feeling more confident in their ability to take on more debt and pay it off in a timely manner."
Findings from the report showed that of all new vehicles financed, leases accounted for an all-time high of 27.64 percent during the second quarter, up from 24.4 percent in Q2 2012. Additionally, the report highlighted the differences in financing attributes, such as average monthly payment, credit score and financing term. For example, the average monthly lease payment was $408, compared with $457 on a new vehicle loan.
Lease (new vehicle)
Loan (new vehicle)
Subprime loans continue to gain market share
Nonprime, subprime and deep-subprime new vehicle loans increased to 27.45 percent market share in Q2 2013, up from 25.41 percent in Q2 2012. For used vehicles, nonprime, subprime and deep-subprime loans accounted for 57.31 percent market share in Q2 2013, up from 56.46 percent in Q2 2012.
In other Q2 2013 findings:
The average amount financed was $26,526 for a new vehicle and $17,913 for used The average interest rate was 4.46 percent on a new vehicle loan and 8.56 percent for used The average loan term was 65 months for a new vehicle and 61 months for used The average monthly payment was $457 on a new vehicle and $351 for used