Aging Cars May Continue to Drive CU Loan Growth
The gains in total credit union vehicle loans continue as their 4.3% year over year increase accounted for almost 41% of all loan growth as of June.
According to CUNA Mutual Group’s August edition of the Credit Union Trends Report, used vehicle loans at credit unions were up 3.7% year to date and 6.8% since June 2011.
While posting an annual decline of 0.2%, the new vehicle loan portfolio is up in each of the past four months and up 2% YTD. At 3.68%, the national average new vehicle loan rate has declined roughly in line with used vehicle loan rates, according to the report.
“While the majority of consumers remain financially cautious, the growing need for replacement vehicles is driving sales and financing gains,” wrote Dave Colby, CUNA Mutual chief economist, in the report. “Our current outlook calls for a modest uptick in new vehicle sales and solid used car sales for the next several years, barring any shocks.”