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Average monthly payments for new-vehicle purchases ($530), new-vehicle leases ($430), and used vehicles ($381) all reached new highs, growing by 4% to 6% year-over-year. Auto loans now account for a full 8% of all outstanding consumer debt — up from 6% just a decade ago.
The vehicles with the largest increased monthly payment were the Nissan Sentra, Toyota Corolla, and Nissan Altima, which were 22.91%, 16.36%, and 15.13%, respectively.
Utility vehicles and pickups played a large part in driving up the average transaction price for a new vehicle to $35,635 in May, a 3.4% increase over the same time last year, according to Kelley Blue Book.
The loan amount for a new vehicle in the first quarter of 2018 was $31,445, $921 higher than the same period in 2017. In the used segment, the average loan amount for a vehicle was $19,536, $410 higher compared to the year-ago period.
Manufacturers may choose to absorb higher federal interest rates on new vehicles to keep prices from rising higher than they have been with heavier incentives, but this could have an adverse effect on residual values.
The numbers reveal a number of factories, including Ford, are targeting compact and midsize inventory. Ford offered the most generous discounts on vehicles in those segments.
Wholesale values for used vehicles reach a record-high of 127.9, while new vehicle sales dropped 2% compared to last year.
Car lease credit applicants registered a 72.2% approval rate in February, a 33.3% increase from January’s 50% approval rate but flat with a year ago, according to Swapalease.com.