The oldest child of a loyal customer is five years past college graduation with a steady, high-paying job. Sally's a prime prospect to buy a new car, right?
Nope, she's already carrying a car-sized note, $25,000 in student loan debt. If she comes by the dealership at all, she's likely shopping beaters, not new rides.
And Sally has company, in a trend that has chilling implications for the U.S. auto industry.
As of early 2012, 37 million Americans carried student-loan debt.
By the Consumer Financial Protection Bureau's count, that's $1 trillion they can't spend on cars. It's persistent debt that can drain personal budgets for decades.
America's outstanding student-loan debt is now greater than all auto loans, more than credit card debt.
How will it play out? We don't know because student debts this huge are new. But people with big debt tend to wait, to put off major decisions.
We're building a nation of educated debtors.
Let's run a scenario for our hypothetical Sally. Because of her student debt, she may live at home a year or two longer before getting her own place, may drive a hand-me-down car two or three years before buying a used one, may not buy her first new car until after she's 30. She may marry later, may not have a first child until her mid-30s, may have two children instead of three, and she and her husband may delay or even skip buying a second car.
If Sally's parents also are carrying student loans to help Sally, they may buy less expensive cars or keep them an extra year before replacement.
Let's imagine you're the dealer at the store where Sally and her brand-loyal family shop. Over her lifetime, Sally is going to buy at least one, maybe several, fewer cars from you. Her parents, too.
If you're, say, a Ford dealer, you're selling fewer and cheaper vehicles, Fiestas and Focuses instead of Fusions and Tauruses, Escapes instead of Explorers, and you're getting fewer trade-ins to resell.
The U.S auto market has 37 million Sallys. More if we count the rest of their households.
But here's the real bite: It's getting worse quickly.
About 60 percent of the 20 million current college students borrow. Total U.S. student loan debt increased sixfold between 1999 and 2011, the Bureau of Economic Analysis says. Yes, up 500 percent in 12 years.
And that $1 trillion national total? Old data. Finaid.org says student loan debt hit $1 trillion on May 8, 2012, but the Web site's debt clock stood at $1.17 trillion last week. That's an extra $170 billion in student debt in just 22 months.
Skyrocketing U.S. student-loan debt is more than a crisis. It's unsustainable.
Students and their families cannot continue to assume more and more of the financial burden for higher education without crippling the economy.
The general economic damage from student-loan debtors is bad enough, showing up in lower personal consumption and delayed household formation.
And the auto industry gets whacked more than most other sectors. College-educated people are the most likely to make enough to buy a new vehicle.
But most of the auto industry's best future prospects are debt-impaired. The College Board says more than half of four-year graduates leave college with student loans. The average tab for these new grads: about $30,000.
If selling cars to Sally is tough, and we don't corral this beast, how are our prospects when her younger brother graduates?