For car buyers, payment pressure is on. And for the industry, concern around vehicle affordability has taken center stage.
Interest rates on new-vehicle loans have risen to their highest level in a decade; monthly payments continue to hit record highs; and the new-vehicle loan term, which when stretched over more months can bring down that payment, is staying relatively flat.
Still, the sky isn't falling, industry analysts say. Consumers are still buying vehicles, and delinquency rates are relatively low.
But to avoid delinquencies and defaults, more consumer finance education and lender innovation are needed — and the industry has taken note.
In this report, Automotive News explores the vehicle affordability challenge. We highlight the factors that contribute to rising vehicle costs; the younger generation's response to mounting debt and how their parents have lent a hand; lenders' solutions to financial literacy; the prospect of an economic downturn; alternative data's role in auto finance; and more.