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Automotive Industry:United States: Difference between revisions
Automotive Industry:United States (view source)
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== Affordability == | == Affordability == | ||
[[File:Screenshot 2023-10- | [[File:Screenshot 2023-10-19 141140.png|alt=|center|thumb|718x718px|https://www.coxautoinc.com/market-insights/september-2023-vai/]] | ||
=== September 2023 === | |||
[[File:Screenshot 2023-10-10 110727.png|center|thumb|698x698px|https://www.coxautoinc.com/wp-content/uploads/2023/09/Sept-26-Q3-2023-Cox-Automotive-Industry-Insights-Presentation.pdf]]The typical new-vehicle payment declined 0.8%, and the number of median weeks of income needed to purchase the average new vehicle declined to 42.2 weeks from an upwardly revised 42.6 weeks in August. At 42.2, the affordability index was lower than the 42.9 recorded last September by 1.6%.<ref>https://www.coxautoinc.com/market-insights/september-2023-vai/</ref> | |||
* '''The estimated typical monthly payment declined 0.8% to $765''', from an upwardly revised $771 in August. The average monthly payment peaked at $794 in December. | |||
* The median income grew 0.3%, the average new-vehicle transaction price declined 0.5%, and incentives from manufacturers were nearly unchanged. The typical new vehicle loan interest rate increased to 10.48%, which was a new peak. | |||
* '''Average payments up 23-39% since 2019 and now out of reach for many households''' | |||
* Auto loan rates moved higher in August and now into September with average new up to 9.61% and used at 14.03% | |||
* About 50% of households can only afford a $400 monthly payment | |||
=== June 2023 === | === June 2023 === | ||
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* The typical new-vehicle loan interest '''rate increased by 4 basis points to 9.63%''' | * The typical new-vehicle loan interest '''rate increased by 4 basis points to 9.63%''' | ||
* The estimated typical monthly '''payment increased by 0.2% to $771''' from an upwardly revised $770 in May. The average monthly payment peaked at $795 in December. | * The estimated typical monthly '''payment increased by 0.2% to $771''' from an upwardly revised $770 in May. The average monthly payment peaked at $795 in December. | ||
== Auto Loan Performance == | == Auto Loan Performance == | ||
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* The All-Loans Index increased 0.8% to 97.2 in June, which was the highest reading since March and reflected that auto credit was easier to get than in April and May. '''With the increase in June, access was tighter by 7.1% year over year, and compared to February 2020, access was tighter by 2.0%.'''<ref>https://www.coxautoinc.com/market-insights/june-2023-dealertrack-cai/</ref> | * The All-Loans Index increased 0.8% to 97.2 in June, which was the highest reading since March and reflected that auto credit was easier to get than in April and May. '''With the increase in June, access was tighter by 7.1% year over year, and compared to February 2020, access was tighter by 2.0%.'''<ref>https://www.coxautoinc.com/market-insights/june-2023-dealertrack-cai/</ref> | ||
* The rejection rate for auto loans exceeded the application rate for the first time since the NY FED survey began in 2013 the rejection rate. '''Auto credit rejection has reached new series high in the NY Fed survey at 14.2 percent from 9.1 percent in February. The probability that a loan application will be rejected rose to 30.7 percent for auto loans.'''<ref>https://www.bloomberg.com/news/articles/2023-07-17/more-americans-are-getting-turned-down-for-loans-fed-data-shows?utm_source=website&utm_medium=share&utm_campaign=twitter</ref><ref>https://www.newyorkfed.org/microeconomics/topics/credit-cards-auto-loans</ref> | * The rejection rate for auto loans exceeded the application rate for the first time since the NY FED survey began in 2013 the rejection rate. '''Auto credit rejection has reached new series high in the NY Fed survey at 14.2 percent from 9.1 percent in February. The probability that a loan application will be rejected rose to 30.7 percent for auto loans.'''<ref>https://www.bloomberg.com/news/articles/2023-07-17/more-americans-are-getting-turned-down-for-loans-fed-data-shows?utm_source=website&utm_medium=share&utm_campaign=twitter</ref><ref>https://www.newyorkfed.org/microeconomics/topics/credit-cards-auto-loans</ref> | ||
=== September 2023 === | |||
Auto loan performance was mixed in September as delinquencies increased but defaults declined. Loans delinquent for 60 days or more increased for the fifth month in a row and were up 13.3% from a year ago.<ref>https://www.coxautoinc.com/market-insights/auto-market-weekly-summary-10-16-23/</ref> | |||
* '''In September, 1.89% of auto loans were severely delinquent.''' That was up from August’s 1.85% rate and was the highest September rate dating back to at least 2006. | |||
* '''7.38% of subprime loans were severely delinquent.''' That was an increase for the month from 7.17% in August and was the highest rate for any month dating back to at least 2006. The subprime severe delinquency rate was 72 basis points higher than a year ago, while the aggregate was 16 BPs higher. | |||
* '''Defaults of auto loans declined by 9.8% in total in September from August but were up 31.7% from a year ago.''' Defaults of subprime auto loans declined by 11% but were up 18% from last year. | |||
* During the summer, credit access was made more accessible across all channels and lender types. The All-Loans Index showed an increase of 0.2% to 97.1 in September. This means that '''access is now tighter by 5.9% year over year. Compared to February 2020, access is tighter by 2.1%.'''<ref>https://www.coxautoinc.com/market-insights/september-2023-dealertrack-cai/</ref> | |||
* Movement in credit availability factors was mixed in September. Approval rates increased, subprime share increased, negative equity share increased, down payments declined, and those moves improved consumer credit access. However, average terms lengthened, yield spreads widened, and those moves hurt consumer credit access. | |||
== Credit Standards<ref>https://fred.stlouisfed.org/series/STDSAUTO</ref> == | == Credit Standards<ref>https://fred.stlouisfed.org/series/STDSAUTO</ref> == | ||