In May, "used car finance" delinquency rates fell to 3.8%, their lowest level in eight months. This decline, combined with softening wholesale prices, could improve net recovery rates for lenders in the following quarter. Tips must be paid voluntarily by the customer and not be subject to negotiation, according to a Treasury official. The October report shows improving sentiment among dealers, with 43% pointing to better stock availability and 38% noting rising consumer confidence. Other factors cited include stronger electric vehicle (EV) sales (36%), buyers turning to used cars due to high new car prices (33%), and more stable pricing in the sector (25%). This positioning suggests traders are betting on positive earnings surprises in the upcoming reporting season.
