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Auto Lending Shifts to Higher-Credit Consumers

An Experian report shows credit unions are ahead of the pack when it comes to auto lending.

By Melinda Zabritski | Updated on April 28, 2017

In the third quarter of last year, credit unions surpassed captive auto lenders to become the second largest lender type in the market. The latest results from Experian’s “State of the Automotive Finance Market” report showed credit unions remain the second largest lender type in the market with $277 billion in open auto loans. Banks remain the largest lender type, with $364 billion in open loans, while captive auto lenders ($252 billion) and finance companies ($179 billion) rank third and fourth, respectively.

The automotive lending industry remains on an upward trend overall. In Q4 2016, total dollar value for outstanding loan balances reached a record high of $1.072 billion, up from $987 million in Q4 2015 and $886 million in Q4 2014. All lender types experienced growth year-over-year, led by finance companies (up by 22.4%) and credit unions (up by 15.87%). Banks and captives grew at much lower rates (7.64% and 6.26%, respectively).

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