New Auto Loan Origination Contraction Slows at CUs
The latest forecasts for new auto loan originations at credit unions appear to be positive but with some caveats.
While the rate of portfolio decline at credit unions is slowing, CUNA Mutual Group Chief Economist Dave Colby said his discussions with credit union leaders nationwide indicate that the slowdown in the rate of decline is due to reduced levels of amortization, payoffs and defaults, not to new loan originations.
Still, NAFCU Chief Economist Tun Wai is optimistic about new vehicle loans, saying in the report, “The outlook for the new vehicle market is improving and should show a steady upward trend as the overall U.S. economy improves.”
During April, total vehicle sales on a seasonally adjusted, annualized basis rose from 13.1 million units in March to 13.2 million units, NAFCU reported. Car sales in April declined from March’s rate of 7 million annualized units to 6.8 million annualized units, while sales of light trucks increased from 6.1 million annualized units to 6.3 million annualized units over the same time period.