Analysis from CUNA Mutual Group’s October Credit Union Trends Report revealed that those factors contributed to 4.1% annual new vehicle growth as of August.
A reduced rate of payoffs and less competition from home equity loans have also helped grow credit unions’ new vehicle loans, the data showed.
At $177.6 billion, the industry’s total vehicle loan portfolio has advanced in each of the past seven months and is up $9.5 billion or 5.7% year to date, according to CUNA Mutual Chief Economist Dave Colby.
On an annual basis, the $10.6 billion increase translates into a 6.4% gain, he added.
Roughly 48% of all credit union loan growth since August 2011 has been attributable to vehicle loans. Currently, 29.5% of all credit union loans are vehicle loans, up from 28.8% at this time last year, the report noted.
Used vehicles, which represent 19.1% of all credit union loans, are up 6.0% YTD and 7.6% year-over-year.
“This is the strongest growth since mid-2004. Reports from credit unions indicate loan demand remains brisk,” Colby said. “Mid-year data revisions not only confirmed the vehicle lending growth surge, they added to it.” Overall, total vehicle loans were restated almost $1 billion higher and 0.5% was added to the growth rate.