Prime-credit Customers Get Growing Share of Loans
BANDON, Ore. - A growing percentage of new-car sales are going to prime-credit customers as banks and other financial institutions look for safer bets, according to CNW Marketing Research.
In the preliminary November data, 85.7 percent of those who purchased a car had prime credit — the highest rate since December 2008. And while near-prime held within a narrow band between 10 and 12 percent of buyers, the subprime shopper’s chance of getting a loan shrunk dramatically.
In July of 2006, roughly 16 percent of all new-car sales went to customers who had subprime credit scores. In November of this year, the figure stood at about 3 percent after hitting a 2009 high of 8.4 percent in April.
Financial institutions are trying to scrub their books of anything or anyone who could constitute a bad risk,” wrote the market research firm. “And part of the decline can be traced to consumer sentiment and business psyche.
“There is a definite and profitable market for subprime paper,” CNW added. “Just don’t expect major banks to pay it much heed any time soon. They have their own problems.”
More Industry

Nebraska Rooftop Changes Hands
The Gregg Young Automotive Group has sold its second dealership to Janssen Auto Group, both in Plattsmouth, Neb.
Read More →
Penske Auto Group Deal a Record
The deal to take the dealership and transportation services company private sets a new pace for industry buy-sell transactions.
Read More →
War Toll a Damper on Used Auto Prices
Cox Automotive found wholesale depreciation to be elevated in September amid high fuel prices and this year's unusual hurricane season.
Read More →
Bridge the Maintenance Gap
With many drivers missing recommended maintenance, service departments offering transparency and efficiency have a better chance of reaching financially strained consumers.
Read More →
California Store Has New Owner
The longtime dealership in the northern part of the state is known for robust fleet sales and has served the state capital for 115 years.
Read More →
BMW Plant Pursues Cleaner Energy
BMW Group Plant Leipzig has utilized hydrogen to help power its production since 2013, but a new pipeline is planned to take it to another level.
Read More →
Auto Affordability Inches Up
The latest Cox Automotive and Moody’s Analytics index shows a slight increase in new-vehicle affordability despite high prices.
Read More →
Ohio Auto Group Under New Ownership
After 79 years with the Schluter family, Mansfield Auto Group has been acquired by Missouri-based Clement Auto Group.
Read More →
RV Group Expands Carolina Footprint
Blue Compass RV Columbia Northeast is the 13th RV dealership owned by Blue Compass in the Carolinas.
Read More →
Agent Acumen
An Agent Summit panel of people who’ve been supporting auto dealers for years gave both timely and timeless advice for those starting out or mulling the prospect.
Read More →