NEW YORK — Despite a slight uptick in loss rates in June, Fitch
Ratings insisted U.S. auto loan ABS asset performance continues to be solid
with historically low delinquency rates and loss rates at or near record low.

Analysts explained there are numerous macro factors that are
helping to bolster auto ABS performance. Among them are:

—Stable employment levels
—Revival in the housing market
—Repaired household balance sheets
—Healthy used vehicle values including strong consumer demand for new and used
vehicles.

"From a structural standpoint, performance of 2009-2012
vintage transactions has been better than expected," Fitch said.

In the prime sector, Fitch pointed out 60-day delinquencies stood
at 0.30 percent in June, virtually unchanged over the 0.29 percent recorded in
May. However, they were 25 percent lower year-over-year.

The firm indicated prime annualized net losses were still
within record low levels at 0.20 percent in June despite rising from 0.17 percent
in May. However, it was the second lowest level recorded this year.

Fitch went on to mention prime cumulative net losses hit a new
record low of 0.28 percent in June, just off of 0.29 percent posted in May and 24
percent lower year-over-year.

Turning over to subprime activity, Fitch determined 60-day
delinquencies increased by 5.5 percent in June to settle at 2.90 percent, compared to 2.75 percent seen in May. June's level was 7.5 percent lower year-over-year.

Subprime annualized net losses dropped to 3.80 percent in
June from 3.84 percent in May, improving by almost 3 percent year-over-year.

"Asset performance for auto ABS is likely to soften as we
approach the fall following typical seasonal patterns, but historically will
still be strong overall," analysts said.

The outlook for asset performance is stable in 2013, with a
positive rating outlook," they continued. "Fitch upgraded 18 outstanding
classes of prime auto ABS notes in 2013 year-to-date, consistent with the first
half of 2012."

Fitch recapped that the Manheim Used Vehicle Value Index
crept up to 119.7 in June from 119.1 in May.

Despite being down 8 percent year-over-year and softening
for most of 2013, wholesale vehicle values are healthy in 2013 and well above
the historical average from 2011-2012 (114.0)," analysts said. "This is helped
to produce elevated recovery rates in auto ABS transactions and contain loss
severity, and ultimately loss levels.

"Strong new vehicle sales have resulted in low inventories,
which coupled with the availability of credit and low incentive levels are all
supporting used vehicle values mid-year," Fitch continued.

"Additionally, the recovering housing market is propping up
demand and sales of trucks and SUVs in 2013. Used pickup truck values have
risen almost 4 percent through June of this year, versus June 2012," analysts
went on to say.

Fitch's prime and subprime auto ABS indices are comprised of
$68.3 billion of outstanding notes issued from 125 outstanding transactions. Of
this amount, 71 percent comprise prime auto loan ABS and the remaining 29
percent subprime ABS.

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