Truck wars heat up as more options become available and amenities draw in a rapidly expanding base of shoppers.
Although the average interest rate on a new-vehicle loan is expected to drop year over year, analysts say rates will hit 3-month high as automakers curtail promotional deals, 0% finance offers.
Edmunds’ latest Used Car Report finds high off-lease volumes have suppressed prices and widened the gap between new and 3-year-old models to an average of $14,951.
Edmunds analysts say Black Friday promotions helped suppress new auto loan interest rates last month, registering a year-to-date low of 5.5% and an 8.3% year-over-year decline.
The average interest rate for a U.S. new-vehicle loan fell below 6% for the first time all year as automakers and dealers extended model-year selldown promotions.
TransUnion analysts report more consumers in the prime and superprime credit tiers are choosing to buy used as off-lease units continue to flood the market, offering a budget-friendly alternative to increasingly expensive new cars.
U.S. dealers sold slightly fewer new vehicles last month than in May of 2018, but the annual forecast increased to 17.4 million units — thanks in no small part to strong fleet sales.
The annual forecast for U.S. light-vehicle sales fell to 16.41 million as volume fell 2.3% year-over-year in an April that was expected to bring the year’s first gain following an underwhelming first quarter.
Edmunds analysts say it keeps getting harder for shoppers to afford a new car as prices continue to rise and interest rates remain elevated.
Edmunds says the average APR for a U.S. new-vehicle loan was 6.36% in March, putting dealers and consumers on the cusp of a ‘dramatic shift’ toward the used-car market.
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