July 10, 2020

Used-vehicle down payments reach a high, Edmunds says

Used-vehicle down payments are the highest they have been since Edmunds started collecting data in 2007. Unique market conditions have led to lower interest rates, bigger down payments, less negative equity and increased cross-shopping of used vehicles, according to a statement from the company. The data shows that the average down payment reached $3,167 in June, up nearly 19 percent from June 2019 and up 42 percent from June 2015. The higher down-payment average is a result of buyers having…

Failed Calif. law would have strained auto finance market, group says

During the coronavirus pandemic, federal, state and local governments have introduced measures designed to prevent the spread of the deadly virus, preserve economic stability and provide for Americans hardest hit by the crisis. Measures at every level have been criticized as being too harsh, too lax, overreaching and incomplete, depending on regional variances. A failed consumer protection law in California exemplifies contentious legislation in the time of the coronavirus. The American Financial Services Association believed the rule, AB 2501, which…

Unchanged Fed rate signals pessimism for 2020’s second half

The Federal Reserve stayed the course on the benchmark interest rate last week, highlighting expectations for a rough road ahead for the U.S. economy. Until the coronavirus crisis ends, the lending environment will likely remain under duress.Opportunities remain in the new-car market — but one economist says inventory challenges, a tighter credit environment and high unemployment rates will hinder sales.The benchmark rate, which directly impacts auto lending, is a litmus test for the health of the lending market. The nation’s…

As new-car demand returns, leasing levels refuse to rally

Leasing, which comprises nearly one-third of new-vehicle sales, dropped in April to the lowest levels since 2015 as the coronavirus pandemic collapsed the top two leasing markets in the country and automakers saturated the market with loan incentives. Rising customer demand prompted automakers to pull back on many of those programs, but leasing levels remain well below normal. Leasing levels fell to 24 percent in April, Experian said, down from 30 percent in April 2019. The last time the levels…