Experian Provides Used Market Overview by Risk Scores
SCHAUMBURG, Ill. — According to the latest data from Experian Automotive, the top 10 lenders represented 30.31 percent of all financed used vehicles in July.
Melinda Zabritski, director of Automotive Credit for Experian Automotive, explained that while the top lenders lead the market in volume, their buying patterns are significantly varied.
"GMAC, Toyota Financial Services, DaimlerChrysler Financial Services and American Honda Finance dominated in the prime lending space with more than 50 percent of their volume comprised of this low risk segment," she said.
Meanwhile, at the other end of the risk spectrum, Zabritski indicated, "The highest risk consumers, those in the below subprime segment, were serviced primarily by Capital One Auto Finance, CitiFinancial Auto and AmeriCredit Financial Services.
"As this segment continues to grow, we may see a greater percentage of their portfolio comprised of these consumers," she told SubPrime Auto Finance News.
Experian Automotive narrowed down each lender's portfolio by makeup:
Wachovia Dealer Services
Prime: 40.98 percent
Nonprime: 22.51 percent
Subprime: 13.78 percent
Below subprime: 22.72 percent
Capital One Auto Finance
Prime: 35.92 percent
Nonprime: 17.95 percent
Subprime: 13.96 percent
Below subprime: 32.18 percent
GMAC
Prime: 62.98 percent
Nonprime: 17.15 percent
Subprime: 8.20 percent
Below subprime: 11.67 percent
CitiFinancial Auto
Prime: 16.72 percent
Nonprime: 24.29 percent
Subprime: 20.76 percent
Below subprime: 38.24 percent
Chase Auto Finance
Prime: 49.50 percent
Nonprime: 14.06 percent
Subprime: 9.48 percent
Below subprime: 26.96 percent
Wells Fargo Auto Finance
Prime: 38.71 percent
Nonprime: 23.34 percent
Subprime: 14.51 percent
Below subprime: 23.45 percent
Toyota Financial Services
Prime: 54.27 percent
Nonprime: 16.59 percent
Subprime: 9.27 percent
Below subprime: 19.86 percent
AmeriCredit Financial Services
Prime: 9.41 percent
Nonprime: 18.94 percent
Subprime: 20.79 percent
Below subprime: 50.86 percent
DaimlerChrysler Financial Services
Prime: 52.86 percent
Nonprime: 19.72 percent
Subprime: 10.60 percent
Below subprime: 16.82 percent
American Honda Finance
Prime: 59.17 percent
Nonprime: 13.70 percent
Subprime: 8.14 percent
Below subprime: 18.98 percent
Looking at the correlation between a consumer's credit history and likely vehicle choice, Zabritski found some interesting trends.
"As you move from the prime risk tier down the below subprime risk tier, there's a swap between the consumer composition that occurs in the subprime tier," she said.
"For example, of the top five used vehicles, the Taurus has the greatest percentage of below subprime buyers at nearly 40 percent, while when we move into the nonprime and prime segment it has the fewest consumers — approximately 36 percent of Taurus buyers were prime," Zabritski explained.
Continuing on, she discovered that consumers that purchased the F-150 and the Accord tended to display similar credit patterns.
"Both of these vehicles attract a more prime buyer — more than 50 percent of consumers who purchased these vehicles were prime, while about 20 percent fell into the highest risk tier," she indicated.
Zabritski also analyzed the regional impact of consumer credit and buying patterns for the F-150 throughout several states.
"While the F-150 has very few below subprime buyers, Texas and Florida each generate a greater percentage of these high-risk consumers than Ohio and Pennsylvania," she found.
"The contrast is more noticeable among the prime consumers. In Pennsylvania, more than 60 percent of F-150 buyers are prime," Zabritski reported.
Finally, she ranked the top 50 vehicles by risk score and found, "Consumers who purchased the RX350 had the highest VantageScore of approximately 860, while the Tacoma had an average score of just over 770.
"While the higher scores tend to be more luxury vehicles, it's not exclusively reserved for the high-end vehicles," Zabritski said. "Note that the M-Class, S60 and 3-Series are found in the lower risk tiers."
Editor's Note: For a complete overview of the data contained in this report, including charts, stay tuned for the December issue of SubPrime Auto Finance News.