Failure consumers on car loans at an alarming rate, defects reaching more than 2.3 million
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- Last year, 2,332,837 car loan defects exceeded the levels observed during the major recession.
- About 1.73 million vehicles were included, which was the highest level in more than a decade.
- March sales are expected to decrease slightly compared to last year, but the future seems dark due to prices.
Economists have been concerned about a recession for years and it seems that we will finally occur thanks to a mixture of job cuts, prices and uncertainty. Warning panels are everywhere and consumer confidence has recently reached a 12 -year -old hollow.
Another alarm began to ring like Cox Automotive quietly revealed the “recovery rate has returned to the 2019 levels, while car loan defects are higher”. By digging the figures, there were 2,332,837 defaults by car last year. It is an amazing number and he even overshadowed those during the top of the great recession.
Plus: the record number of Americans are delayed on their car loans
The fault rate last year was 3.13%, which was the highest since 2011. However, this trend began with the major recession, because the defect rate was 3.18% in 2007 and increased to 3.76% in 2008. It then peaked at 4.12% the following year, before slowly setting in the 2% range.
Since references and failures go together like peanut butter and jelly, it is not surprising to learn that there was a peak in redevelopments last year. It is estimated that 1.73 million vehicles were brought back in 2024, which has been the highest level since 2009. The rate of recovery of possession, by 2.3%, also climbed at levels not observed over the years.
By default of car loan
Although these are disturbing developments, Cox said that March sales should not be significantly affected by the threat of tariffs or economic uncertainty. Despite this, they still expect a decrease of 1.4% compared to last year.
The future is as clear as the mud as Cox said: “The prices promulgated in North America as proposed – depending on the duration of their duration – could upset both the American automotive market and the wider economy.”
