More than five million additional consumers had an auto loan in Q2 2016 compared to Q1 2016, according to TransUnion’s Q2 2016 Industry Insights Report, powered by PramaSM analytics. The number of consumers with an auto loan increased 7% from 72.87 million in Q2 2015 to 77.95 million in Q2 2016.
In Q2 2016, the average auto loan balance per consumer grew 2.7% and reached $18,177, the highest level post-recession. The average balance was up from $17,699 in Q2 2015.
In recent years, the auto industry has experienced strong growth in truck and SUV sales, which we believe is one of the drivers for higher average auto balances. Strong economic fundamentals—particularly low gas prices and rising employment—are contributing to the continued growth in the auto sector.
Viewed one quarter in arrears to ensure all accounts are reported and included in the data, auto loan originations grew 6.4% year over year in the first quarter of 2016. Auto originations reached their highest post-recession level at 6.93 million in Q1 2016, up from 6.51 million in Q1 2015.
In Q2 2016, the auto delinquency rate increased to 1.11%, an 11-basis point rise from 1.00% in Q2 2015. While delinquency rates rose in the second quarter, auto delinquency has been at all-time lows. We do not see a cause for concern from this slight increase.
Trends in the Auto Market
|Auto Lending Metric||Q2 2016||Q2 2015||Q2 2014||Q2 2013|
|Delinquency Rate (60+ DPD) Per Borrower||1.11%||1.00%||1.09%||0.95%|
|Average Debt Per Borrower||$18,177||$17,699||$17,127||$16,424|
|Prior Quarter Originations*||6.93 million||6.51 million||6.23 million||5.75 million|
*Note: Originations are viewed one quarter in arrears to account for reporting lag.