Things are looking pretty rosy for credit unions in the auto lending space. According to the Experian Q4 2022 Auto Finance Market Report, credit unions now capture nearly 25 percent of new loans and experienced the highest growth within the auto lending market. Payments and loan amounts also increased year-over-year in 2022, adding more revenue to credit unions auto loan portfolios. Credit unions remain the best option for many consumers with rates at 5.5 percent versus banks, financing companies and other types of lenders.
In the used car space, credit unions have pulled ahead to become the number one option for financing with greater than 30 percent market share. Terms and rates increased across all types of credit segments while loan amounts and payments also increased. As with new loans, credit unions also offered the lowest rates at roughly 7 percent versus other financing options. But amid all the good news, 60-day delinquencies ticked up to above pre-COVID levels for the first time since 2018. For some segments of the economy, money woes are growing.
Opportunities in EVs on the horizon
While sales of U.S. passenger vehicles fell in 2022, the number of electric vehicles (EVs) sold rose by a remarkable 65 percent, an increase of almost two thirds compared to 2021. EVs accounted for 5.8 percent of all new cars sold in the US, an increase from 3.1 percent the year prior. Industry projections expect the number of electric vehicles sold in the US will surpass the 1-million mark in 2023. This growth will be driven by OEMs increasing inventory, improved charging infrastructure, and affordability. The average price of an EV sold in the US last year was $61,448, a 5.5 percent decrease compared to 2021.