US Auto Loan Market Size
| Study Period | 2020 - 2029 |
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2029 |
| Historical Data Period | 2020 - 2022 |
| CAGR | 6.00 % |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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US Auto Loan Market Analysis
The United States auto loan market has a loan outstanding of USD 1.502 trillion in the current year and is poised to register a CAGR of more than 6% for the forecast period.
The growth of automobile loans in the United States has observed a continuous rise over the years. In terms of the interest rate on automobiles, new vehicles in the United States exist with a significantly lower interest rate as compared to used vehicles because of the lower level of price risk associated with them, and this drives their loan product sales. Among the passenger vehicle sales in the country, SUVs and Pickup trucks exist with more than 60% of the sales.
As the number of vehicles in operation is observing a continuous increase, sales of automobiles are increasing, leading and rising business opportunities for the automobile loan providers. The vehicle ownership rate in the United States exists at more than 91%, leading to the creation of a business cycle of new and used vehicle sales in the market and financial institutions emerging with a variety of loans and financing products. In addition, the rise in the number of fintech institutions and financial companies in the country is expanding the reach of the auto loan market with a competitive rate of interest over various periods of auto loan.
Post-COVID-19, the sales of electric vehicles in the United States are observing a continuous increase, with the government launching various initiatives to make them affordable with the creation of emerging opportunities in the automobile loan market. Recently, the government, under its Inflation Reduction Act, launched a tax credit of USD 7500 for the purchase of electric vehicles if the final assembly is done in the United States. In addition, automobile manufacturers and sellers such as Ferrari have started to accept cryptocurrency for their sales, and financing firms are opting for various cryptocurrencies as collateral for automobile loans, taking the market in a new direction.
US Auto Loan Market Trends
Rising Price of Automobiles
Prices of automobiles in the United States are observing a continuous increase, resulting in an increasing number of vehicle buyers opting for loans and financing instruments. The inflation rate on automobiles exists at a higher rate in comparison to the inflation on all goods and services. A larger number of manufacturers in the country are operating at a lower-than-optimal capacity production level, and rising semiconductor prices combined with the surge in demand from the buyer's side are resulting in demand-pull inflation and building the market in favor of automobile loan providers. The price of new vehicles is observing a y-o-y growth of around 4.5%, with the average price of used vehicles surging more than 30% from the pre-pandemic level. To control this inflation, the United States Fed is making a continuous rise in its rate of interest, simultaneously resulting in the rising interest rate of auto loans and risk premiums by the banks in it. This cycle effect of rising automobile prices and interest rates is creating an increase in interest revenue for Automobile loan providers in the country.
Rising Sales of Light Trucks
Among the vehicle sales by type in the United States, light trucks exist with the highest share. This is leading to a large number of banks, financial companies, and other lending platforms focusing on light trucks-specific loan and finance products. Wyoming, Montana, Idaho, South Dakota, and Alaska have emerged as the states leading in the share of light trucks, resulting in auto loan providers expanding their businesses over different states as per the rising sales data to reap the market benefit. In terms of sales, Texas has emerged as the state leading in sales of light trucks. Toyota and Ford are among the existing companies manufacturing light trucks in the United States and observed higher sales in comparison to cars, creating a positive market for loans and financing of light trucks by lenders. More than 9 million new light trucks were sold in the country last year, existing at a significantly higher level than passenger cars, a significant segment of automobile loans in the country.
US Auto Loan Industry Overview
The United States auto loan market is highly fragmented, with a large number of players existing in the market. Rising competition among various lenders is leading to innovation in auto loan products by the lender. Technological innovations of digital banking, fintech, and cryptocurrency as collateral are leading to a new rise in the United States Auto Loan Market. Some of the existing players in the United States Auto Loan market are Ally, Bank of America, Toyota Financial, Capital One, Lending Tree, and Others.
US Auto Loan Market Leaders
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Ally
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Bank of America
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Toyota Financial
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Capital One
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Lending Tree
*Disclaimer: Major Players sorted in no particular order
US Auto Loan Market News
- August 2022: United States Bancorp launched its innovative real-time payment system, RTP Network solution, through which it can provide loan funds to auto dealers after the finalization of a loan contract by the bank. United States Bancorp has its businesses spread over Consumer and Business Banking, Payment Services, Corporate and Commercial Banking, and Wealth Management and Investment Services.
- January 2023: AutoFi Inc., which exists as a digital commerce technology provider in sales and finance for the automotive industry in the United States, partnered with Santander Consumer USA Inc., which is a consumer finance company focused on vehicle finance. The partnership will likely bring to market digital products to improve consumers' and dealers' interaction with the lender and simplify the car buying experience.
Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions and Market Definition
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET DYNAMICS AND INSIGHTS
- 4.1 Market Overview
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4.2 Market Drivers
- 4.2.1 Increase In Demand For Light Trucks
- 4.2.2 Quick Processing of Loan through Digital Banking
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4.3 Market Restraints
- 4.3.1 Increasing Inflation In Automobile Market
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4.4 Market Opportunities
- 4.4.1 Flexible Interest Rate by Financing Companies Raising their Market Share
- 4.4.2 Emerging Market of Electric Vehicles Expanding the Auto Loan Market
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4.5 Industry Attractiveness - Porter's Five Forces Analysis
- 4.5.1 Bargaining Power of Suppliers
- 4.5.2 Bargaining Power of Buyers
- 4.5.3 Threat of New Entrants
- 4.5.4 Threat of Substitutes
- 4.5.5 Intensity of Competitive Rivalry
- 4.6 Technological Innovations in United States Auto Loan Market
- 4.7 Impact of COVID-19 on the Market
5. MARKET SEGMENTATION
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5.1 By Vehicle Type
- 5.1.1 Passenger Vehicle
- 5.1.2 Commercial Vehicle
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5.2 By Ownership
- 5.2.1 New Vehicle
- 5.2.2 Used Vehicle
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5.3 By End User
- 5.3.1 Individual
- 5.3.2 Enterprise
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5.4 By Loan Provider
- 5.4.1 Banks
- 5.4.2 OEM
- 5.4.3 Credit Unions
- 5.4.4 Other Loan Providers
6. COMPETITIVE LANDSCAPE
- 6.1 Market Concentration Overview
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6.2 Company Profile
- 6.2.1 Ally
- 6.2.2 Bank of America
- 6.2.3 Toyota Financial
- 6.2.4 Capital One
- 6.2.5 Lending Tree
- 6.2.6 US Bank
- 6.2.7 Nissan Infiniti
- 6.2.8 PNC Bank
- 6.2.9 Credit Acceptance
- 6.2.10 Carmax*
7. MARKET FUTURE TRENDS
8. DISCLAIMER AND ABOUT US
US Auto Loan Industry Segmentation
An automobile loan allows a user to borrow money from a lender and use it to purchase different forms of vehicles, which include passenger and commercial vehicles. The loan is paid back to the issuer in the form of installments over some time with an agreed amount of interest payment.
The United States auto loan market is segmented by vehicle type (passenger vehicles, commercial vehicles), by ownership (new vehicles, used vehicles), by end-user (individuals, enterprises), and by loan provider (banks, OEMs, credit unions, and other loan providers).
The report offers market sizes and forecasts for the United States auto loan market in value (USD) for all the above segments.
| By Vehicle Type | Passenger Vehicle |
| Commercial Vehicle | |
| By Ownership | New Vehicle |
| Used Vehicle | |
| By End User | Individual |
| Enterprise | |
| By Loan Provider | Banks |
| OEM | |
| Credit Unions | |
| Other Loan Providers |
Frequently Asked Questions
What is the current US Auto Loan Market size?
The US Auto Loan Market is projected to register a CAGR of greater than 6% during the forecast period (2024-2029)
Who are the key players in US Auto Loan Market?
Ally, Bank of America, Toyota Financial, Capital One and Lending Tree are the major companies operating in the US Auto Loan Market.
What years does this US Auto Loan Market cover?
The report covers the US Auto Loan Market historical market size for years: 2020, 2021, 2022 and 2023. The report also forecasts the US Auto Loan Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
US Auto Loan Industry Report
Statistics for the 2024 US Auto Loan market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. US Auto Loan analysis includes a market forecast outlook to for 2024 to 2029 and historical overview. Get a sample of this industry analysis as a free report PDF download.
