Experian: Shift Toward Used Continues in Q2
SCHAUMBURG, Ill. — Car buyers with prime and superprime credit shifted toward used in greater numbers, with used-vehicle loans for both low-risk tiers reaching record highs in the second quarter, according to Experian Automotive.
According to the firm, a record 61.02% of prime consumers chose used vehicle loans, up 1.12 percentage points from a year ago. In the superprime category, a record 44.32% of superprime customers took out used-vehicle loans, 1.06 percentage points higher than a year ago. The shift comes as new-vehicle loan payment reached a record $504, about a $139 difference from the average used-vehicle loan payment.
"One of the trends that we've consistently seen is all-time highs and record-highs of prime-plus consumers who are choosing a used vehicle," said Melinda Zabritski, senior director of financial solutions at Experian Automotive, adding that the gulf between payment amounts has played a major role in the new-to-used shift.
The used-vehicle market, however, wasn’t the only solution for car buyers seeking payment relief. Loan terms, which continued to stretch during the period, were also a go-to option in the second quarter.
According to Experian, the 61- to 72-month term band did lead the way in the second quarter, accounting for 40.4% of all new-vehicle loans. However, the 73- to 84-month and 85- to 96-month bands showed the largest growth.
The share of loans in the 73- to 84-month range increased 1.22 percentage points from a year ago to 32.5%, while the 85- to 96-month band increased 0.3 percentage points to 32.5%. Zabritski noted that a majority of loans in the latter range were primarily clustered around 85 months.
Also reaching a new record was the balance of outstanding loans, which increased from $1.027 trillion in the year-ago quarter to a new high of $1.1 trillion. The new high was achieved as delinquencies, which have caused a slight tightening in underwriting standards in recent quarters, showed some improvement.
According to Experian Automotive, the 30-day delinquency rate inched down 0.02 percentage points to 2.2%, while the 60-day rate increased slightly by 0.05 percentage points to 0.67%.
The improvement in delinquencies didn’t translate into a loosening of credit standards, however, with the share of subprime lending in the second quarter dropping from 21.46% in the year-ago quarter to a near-record low of 20.57%. Deep subprime also showed no improvement, falling 0.08 of a percentage point to a near low of 3.98%.
"The last time deep subprime was below 4% for a Q2 period was way back in 2012, and it was 3.77%," Zabritski noted. "The all-time Q2 low was seen back in 2011. It was about 3.64%, but, again, we're still near historic lows for deep subprime in the total loan market."
More Industry

Achromatic Autos
The shades that dominate the U.S. car market don’t call attention to themselves, though grayscale may have plateaued after a 30-year upswing, research shows.
Read More →
Used-Vehicle Affordability Worsens
Listing prices in August defied seasonal trends, rising above $27,000 for the second time this year.
Read More →
First-Half Dealership Deals Up
Buy-sell activity shows that acquirers are looking for value and scale as many retailers seek to leave an increasingly competitive and complex market, Kerrigan Advisors reports.
Read More →
Kia Closes Out Summer With a Bang
Its U.S. subsidiary broke multiple records in August, in part due to a surge of demand for hybrids models.
Read More →
Indiana Dealership Changes Hands
A 30-year-old Ford dealership in Indiana has a new owner and will soon be undergoing renovations to meet manufacturer requirements.
Read More →
Texas Dealership No Longer in the Family
The Ford store, a longtime cornerstone of the Houston market, is now part of one of the fastest-growing U.S. auto groups.
Read More →
Genesis Grows California Presence
The Cardinale Automotive Group opened its third Genesis rooftop in the Golden State, Genesis of San Bruno, a stand-alone dealership serving the San Francisco Bay Area.
Read More →
August Auto Sales a Mixed Bag
An early forecast shows strong business despite consumer hurdles, and hybrids are a big piece of their affordability coping strategy.
Read More →
EV Market Humming Along
July sales show steady growth as the segment stabilizes from last year’s artificial surge following pullback of federal support.
Read More →
Auto Loan Delinquency Rates Stabilize
Auto loans are a main driver of nonmortgage consumer debt, but delinquency rates stabilized in the second quarter across all credit risk tiers.
Read More →