Here are 25 facts about the auto industry – including car loans and how a good credit score can save you a lot of money when buying!
1. In 2017, we bought a lot of cars! In fact, 6.2 million new cars were sold, as well as 11.1 million SUVs and light trucks, adding up to approximately 17.3 automobile transactions.
2. Considering that there are approximately 323 million people in the United States, that means more than 1 out of every 18.6 people bought a brand new car…just this year!
3. While those numbers are impressive, they’re slightly off of the high point of auto sales in 2016, when nearly 17.5 million light passenger vehicles sold, as well as 17.4 million in 2015.
4. Worldwide, 78.6 new cars sold in 2017!
5. In 2017, the motor vehicle industry (including manufacturers, dealerships, used part dealers, service centers, etc.), employed almost one million U.S. workers (approximately 940,000).
6. In fact, the auto industry is responsible for about 3 to 3.5% of our entire U.S. gross domestic product.
7. We also manufacture a lot of cars in the United States these days. In fact, nearly 12 million light passenger vehicles were built in the good ‘ole U.S. of A last year.
8. At least 2.1 million of those automobiles were exported and sold abroad, spanning almost every country in the world for a total value of $57 billion.
9. Additionally, the secondary automobile parts export market is worth an impressive $80 billion, and we also exported $5.5 billion in used cars.
10. While that’s a whole lot of new cars, the U.S. is still second to China for automobile markets, both in terms of sales and production.
11. Of course, a lot of car sales mean a lot of car sales dealerships. In fact, there are currently 18,250 new vehicle dealerships in the United States.
12. According to government estimates, there are about 222 million licensed drivers in the United States, which means that about 69% of our country has a driver’s license.
13. We also know that there are approximately 260 million passenger cars, trucks, and SUVs on the roads, which adds up to 1.24 automobiles for every person with a driver’s license in the U.S.!
14. In fact, there are 260,350,940 registered vehicles in the United States, which is an all-time high.
15. That also accounts for 20 million more automobiles than 2007, and in 1990 there were only 193 million registered autos in the U.S.
16. But the car market is still heating up around the world, with new car dealers expected to bring in 916 billion by 2020, with used car sales following with 106.6 billion in sales.
17. An interesting data point is the Scrappage Rate, which measures the number of cars sent to junkyards and put out of service every year. Over the last couple years, the Scrappage
18. Rate fell to only 11.5 million annually, a record low when compared to the number of cars on our highways and roads.
19. If we look at the monthly budget of the average America, their rent or mortgage payment tops the list, but transportation costs (including car payments) comes in second.
In fact, when added together, housing and transportation account for about 50% of the typical American’s income.
20. The average American’s monthly spending chart looks like this (based on a $51,442 per capita): income:
33% Housing, $16,887
17% Transportation, $8,998
13% Food, $6,599
11% Insurance, $5,591
7% Health Care, $3,556
5% Entertainment, $2,605
3% Clothing, $1,736
11% Total other expenses, $5,470
21. While we may be buying new cars at record rates, we’re still using financing to purchase the vast majority of them. In fact, in 2017, auto lending hit a new record with more than $1.1 trillion in car loans owed by consumers!
22. In fact, the average person with a car loan now has $18,694 in auto debt, and the average new car came with a sticker price of about $35,000 in 2017.
23. But last year, the average person who financed their car purchase borrowed $30,032 in loans (the first time that average exceeded $30,000). The average monthly payment for a new car loan is now $503, the first time that number has risen over $500.
The average loan term is now 67 months (5.58 years) for new automobiles and 62 months (5.16 years) months for used autos, both record highs.
24. However, car loans are being extended to people with marginal or even poor credit scores like never before. These days, almost 20% of all auto loans go to people with credit scores of 620 or less – called “subprime” (a score of 680 is typically considered good.)
According to Experian, 19.3% of auto loans now go to consumers with subprime or deep subprime credit scores. That means less than two-thirds of auto loan borrowers (61.3%) have prime or super-prime credit.
25. There’s no denying that it’s a great feeling to buy a new car, and reliable transportation is a must for most of us. However, subprime auto loans tend to come with sky-high interest rates and cost us way too much in total interest. For example, a person financing a $23,000 car might spend $9,615 just in interest with a 66-month loan at 14.99 percent!
So, in order to get a great car loan, have a better monthly payment, save a lot in total interest, AND get that beautiful new car you love (and deserve), talk to Nation Wide Credit Clearing first about improving your credit score!