The "used car finance rate" is a key factor for auto lenders and their stock performance. Current average APR is 8.3%, slightly higher than last quarter, influencing Q2 earnings expectations for finance-heavy portfolios. Institutional investors note that tighter credit could impact revenue guidance for auto loan originators. And it’s not just the Honda Prologue. While all cars lose value the moment they're driven off the lot, EVs lose their value faster than gas-powered cars. In fact, EVs depreciate 58.8% over five years, according to iSeeCars, compared to 45.6% for all vehicles (including gas and hybrid cars). (2) Auto loans are available in 12-month increments, ranging from 24 to 96 months. The most common terms are 60 and 72 months, but 84-month terms are becoming more common. Stock price fluctuations in auto lending companies reflect the current "used car finance rate", which lingers above 8%. Equity strategists are projecting mild profitability boosts, but warn that economic softening may lead to reduced loan originations later this year.
