New Vehicle Inventory Bounces Back, Reshaping the Automotive Finance Market During the First Quarter of 2024
“The return of new vehicle inventory has had a ripple effect across the automotive finance market,” said
Largely driven by the availability of new vehicle inventory in Q1 2024, new vehicle leasing experienced a significant increase, reaching 24.12%, up from 19.33% in Q1 2023. In addition, the average monthly payment for a new lease dropped
Notably, SUVs comprised the majority of the top leased vehicles in Q1 2024, with the Honda CR-V at 3.12% and Tesla Model Y at 2.69%. Rounding out the top five were the Nissan Rogue (2.35%), Chevrolet Equinox (2.21%), and Honda Civic (2.02%).
Average monthly payments remain relatively stable
The average loan amount for a new vehicle was
The average interest rate for a new vehicle was 6.73% in Q1 2024, up from 6.61% the previous year, while the average interest rate for a used vehicle was 11.91%, up from 11.40% over the same period. As a result, the average monthly payment for a new vehicle increased
Interestingly, data showed that 16.31% of all new vehicle loan payments were over
EV interest continues to grow
EVs accounted for 8.56% of all new vehicle financing in Q1 2024. In addition, consumers are leasing EVs at a higher rate than previous years, with leasing making up 35.22% of EV financing in Q1 2024, an increase from 12.27% the previous year.
Of the top five leased EV models in Q1 2024, Tesla Model Y made up 39.26%, followed by the Tesla Model 3 (11.88%), Tesla Model X (3.72%), Rivian R1S (3.03%) and Volkswagen ID.4 (3.00%).
“With more manufacturers rolling out a diverse range of EV models and a wider availability of tax incentives, we’re seeing consumers lean into the EV market, particularly with leasing,” Zabritski continued. “As technology evolves and infrastructure continues to develop, it’ll be interesting to see the buying preferences for these consumers once they come off lease.”
Additional findings for Q1 2024:
- Prime and super prime borrowers accounted for nearly 69% of the total finance market in Q1 2024.
- Captives comprised 31.39% of total vehicle finance market share this quarter, up from 25.93% last year. Banks went from 25.98% to 25.07% year-over-year and credit unions declined from 25.17% to 20.14% in the same time frame.
- New SUV registrations continue to grow at 64.29% in Q1 2024, up from 61.70% last year, while sedans declined from 16.53% to 15.46% over the same period.
- 30-day delinquencies increased from 2.34% in Q1 2023 to 2.72% in Q1 2024, and 60-day delinquencies reached 0.88% this quarter, up from 0.76% last year.
To learn more, watch the entireState of the Automotive Finance Market Report: Q1 2024 presentation on demand.
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Source: Experian