THE SHOP

February '20

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4 THE SHOP FEBRUARY 2020 \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\ \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\ © 2020 National Business Media, Inc. All rights reserved. THE SHOP (ISSN 2380-7415) is published monthly by National Business Media, Inc., 2800 W. Midway Blvd, Broomfield, CO 80020; (303) 469-0424; FAX (303) 469-5730. Subscription rates in the U.S.: One year, $45; Two years $80; Three years $108. Canada: One year, $76; Two years, $142; Three years, $201 (U.S. Funds). Mexico/International: One year, $98; Two years, $186; Three years, $267 (U.S. Funds). Periodicals Postage Paid at Broomfield, CO 80020-9998 and additional mailing offices. USPS/National Business Media Automatable Poly. POSTMASTER: Please send address changes to THE SHOP, PO Box 460651, Escondido, CA 92046-0651. All items submitted to THE SHOP become the sole property of THE SHOP and National Business Media, Inc. and may not be reproduced without the written consent of the publisher. Advertisers and/or their agencies, jointly and severally, assume all liability for printed advertisements in THE SHOP. Opinions expressed in THE SHOP may not necessarily reflect the opinion of the magazine's editor, its management or its advertisers. Letters, photographs and manuscripts welcome. s your shop taking advantage of the local used car market? Used vehicles are commanding a larger share of the U.S. automotive finance market, according to Experian's Q3 2019 State of the Automotive Finance Market report. Used vehicle financing increased 2.4% year-over- year, reaching 55.15% in Q3 2019, compared to 53.86% in Q3 2018. The trend appears to be driven by a number of fac- tors, including a higher percentage of prime customers financing used vehicles and an increased availability of late-model vehicles. While used vehicle loans saw growth in Q3 2019, the most significant shift was in the super prime segment, increasing 3.3% to reach 13.42% during the quarter. As a whole, prime and super prime consumers make up 51.24% of used loans—the highest percentage since Q3 2009. Even when financing used vehicles, consumers continue to lean toward longer pay- ment terms, with used terms clocking in at 64.89 months and average new vehicle loan terms reaching 69.28 months. "Consumers appear to be realizing that financing a used vehicle can be an optimal choice—particularly as they look to improve their financial health. With so many late-model vehicles, used vehicles can offer similar features to new vehicles but at a lower cost," said Melinda Zabritski, Experian's senior director of automotive financial solutions. "Understanding these trends can help lenders and dealers ensure they have the right options available for consumers." As prime consumers continue to shift to used vehicles, they're also shifting where they shop for those vehicles. Independent dealers saw an increase in prime and super prime financing, with both segments making up 37.92% of loans in Q3 2019, compared to 34.87% a year ago. Independent dealers also saw an increase in average used loan terms, from 60.86 months in Q3 2018 to 62.59 months in Q3 2019. Average vehicle loan amounts continued to increase across the board. The average loan amount for a new vehicle increased 3.8% to reach $32,480, while the average used loan amount increased 2.3% to reach $20,466. The average monthly payment for a new vehicle was $550, while the average monthly payment for a used vehicle reached $393. Average credit scores have also seen significant improvement over the past four years. The average credit score for a new vehicle increased 10 points from Q3 2015 to reach 725. Similarly, the average credit score for a used vehicle increased 12 points during the same time period to reach 662. "Credit scores are one of the critical factors that can determine loan terms and interest rates when shopping for a vehicle loan, so consumers should be sure their credit is in the best shape possible before they're in the market," Zabritski said. The Used Vehicle Market Stays Strong I \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\ DRIVER'S SEAT PUBLISHER REGAN DICKINSON rdickinson@nbm.com EXECUTIVE EDITOR JEF WHITE jwhite@nbm.com DIGITAL CONTENT EDITOR A.J. HECHT ahecht@nbm.com ART DIRECTOR IVETH GOMEZ igomez@nbm.com GRAPHIC DESIGNER LINDA CRANSTON linda@nbm.com EASTERN TERRITORY SALES MANAGER WENDY MILES wmiles@nbm.com WESTERN TERRITORY SALES MANAGER RYAN WOLFE rwolfe@nbm.com SALES SUPPORT ERIN GADDIE egaddie@nbm.com TECHNICAL CONTRIBUTOR MIKE MAVRIGIAN birchwdag@frontier.com CONTRIBUTING WRITERS JOHN CAROLLO, STEFANIE GALEANO-ZALUTKO, JOHN GUNNELL, COURTNEY PAHLKE, JOSH POULSON, CHAD STORLIE, TONY THACKER, LARRY WEINER NATIONAL BUSINESS MEDIA PRESIDENT DAVE POMEROY VICE PRESIDENT / AUDIENCE & EVENTS LORI FARSTAD VICE PRESIDENT / FINANCE KORI GONZALES, CPA VICE PRESIDENT / MEDIA & DEVELOPMENT JOHN A. BENNETT DIRECTOR OF TECHNICAL SERVICE WOLF BUTLER MULTIMEDIA PRODUCER ALISON MCDONALD CEO & OWNER ROBERT H. WIEBER, JR. Jef White Executive Editor www.theshopmag.com

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