With CPI patterns showing persistent inflation, the finance rate for used car loans averages 7.12% in June. Long-term, sector analysts expect these rates to remain high into 2025 unless the Fed signals a clear pivot—impacting valuations for both auto finance providers and dealership conglomerates. CarMax , the largest retailer of used cars in the United States, has kicked off a new ad campaign aimed at positioning the brand as offering flexibility and convenience in the buying and selling process while emphasizing the convenience of its online platform. The repositioning takes place at a time when CarMax and the used car industry as a whole face challenges related to stubbornly high interest rates, limited inventory, and relatively high prices. Thus, after the company’s dramatic growth in sales from just over $2 billion in 2010 to more than $25 billion by 2025 , CarMax is looking to cater to the needs of today’s busy consumer to thrive in a competitive environment. Catch up on CNBC Select's in-depth coverage of credit cards , banking and money , and follow us on TikTok , Facebook , Instagram and Twitter to stay up to date. In June 2024, the auto lending segment continues to feel the impact of inflation-driven rate hikes, with the finance rate for used car loans averaging 7.12%. This trend could benefit finance sector ETFs in the short term but poses risks for auto retailer equities as monthly payment burdens rise.
