Auto Shopping Stretches Budgets to New Highs
Q2 patterns break industry records on multiple fronts, Edmunds reports.

The average financed new-vehicle amount in the second quarter was $42,388, a record high and up 2% quarter-over-quarter and 4% year-over-year.
Pexels/Karolina Grabowska
Second-quarter data show auto consumers stretched every which way but loose to squeeze a new car into their budgets.
The quarter, which included the closing gasps of tariff-dodging buys, in fact brought new financing records that would seem to bode ill down the road.
New records, according to Edmunds data, included:
The share of auto loans exceeding 84 months, or seven years, hitting 22% of new-vehicle financing, up from 20% quarter-over-quarter and from about 18% year-over-year.
Monthly payments of more than $1,000 hitting a new high of 19%, up from 18% quarter-over-quarter and year-over-year
Average financed new-vehicle amount of $42,388, a record high and up 2% quarter-over-quarter and 4% year-over-year
Zero-percent financing deals sinking to an all-time low of less than 1%, down from 3% year-over-year
Meanwhile, second-quarter auto shoppers put forward an average down payment of $6,433, down 1% quarter-over-quarter and 2% year-over-year. The average annual percentage rate meanwhile ticked up a tenth of a percentage point from the first quarter to 7.2%.
"It would be easy to assume that tariffs are already reshaping the market, but the reality is that the record-breaking trends we saw in the second quarter are reflective of more consumers opting for maxed-out term lengths despite vehicle prices remaining steady," said Edmunds Director of Insights Ivan Drury.
"It's clear that buyers are pulling the few levers they can control to manage affordability, whether that's by taking on longer loans, financing more, or putting less money down — even if some of those decisions increase their total costs. Consumers are continuously stretching to afford new vehicles in this market, and while tariffs haven't directly driven these Q2 numbers, they're certainly not going to make things any easier for shoppers moving forward."
Though Edmunds didn’t say it, the tariff price avoidance shopping may have moved some consumers to make the wallet-emptying moves, thinking they’d at least avoid any tariff-inflated prices that came later.
But such spending habits don’t come without risk, pointed out Edmunds Consumer Insights Analyst Joseph Yoon.
“While extended loan terms may make a monthly payment more palatable, consumers need to keep in mind the risks associated with a loan extended that far into the future, including increased costs for upkeep down the line and the risk of being underwater on the loan if the car is traded in before it's paid off."
Originally posted on F&I and Showroom
More Industry

Autos More Appealing
Consumers gave new cars better scores again this year for design, performance and more as mass-market brands kept gaining on premium lineups, JD Power found in an annual poll.
Read More →
Used EVs Defy Overall Market
While the used-car market saw three months of price declines or stagnation, the used EV segment did the opposite – rising for three straight months.
Read More →
Gone to the Dogs
A Stellantis brand decided to have some fun with one of its SUVs’ design to address growing emphasis on family pets.
Read More →
OEM Poll Sees Industry Evolution
Kerrigan Advisors’ survey of automakers finds that tariffs, technology, network tightening and other factors are poised to reshape auto retail.
Read More →
Luxe N.C. Dealerships Change Hands
A collection of Italian and English brand franchises were handed off to the owner’s friend in the business and include the Carolinas’ only Ferrari retail stores.
Read More →
Exposure Drives Interest in Chinese Cars
At a recent demonstration, consumers had the chance to ride in a Chinese-branded vehicle, a firsthand experience that improved their perceptions and purchase intent.
Read More →
Automotive Consumers Sink Further in Debt
Most financing metrics hit records in the second quarter as more buyers locked themselves into long terms and high monthly payments.
Read More →
Agent Advocate
Rob Mancuso, who comes from a long line of auto dealers, values general agents’ place in the industry and makes a case for them taking an even bigger seat at the table.
Read More →
Driving Under Distraction
Though consumers gave higher marks to new vehicles in JD Power’s most recent initial-quality poll, high-tech interference worsened, pointing to craving for simplicity.
Read More →
Affordable New Cars a Thing of the Past
More than one out of five new vehicles sell for more than $60,000, according to Edmunds. That's up 7% compared to prepandemic 2019.
Read More →