Auto loans cheapest ever, study says

[Jan 31, 2011.]

 

Auto loans at outstanding rates, everywhere

Those buying cars last month had access to auto loans with the lowest annual percentage rates (APRs) on record, according to data published Jan. 20 by automotive industry information company Edmunds.com. The average APR was 4.15 percent, down 0.55 points on the same month in 2009, and 0.33 points from November.

Of course, those sorts of rates are only available to those with spotless credit records. In addition, the average was helped by the whopping 15.4 percent of auto loans that carried zero percent promotional rates. However, it seems likely that most car buyers had access to better rates than they could have hoped to secure for some years, possibly ever.

Cheap auto loans translating into car sales?

A week after unveiling its interest rate data, Edmunds.com came out with optimistic forecasts for light vehicle sales for January. It expects combined fleet and retail sales to reach 816,000 units in January, which is a 17.3 percent increase from the same period a year ago. Analysts say that would translate into a seasonally adjusted annualized rate of 12.57 million vehicles sold. In a statement, Edmunds.com Senior Analyst Jessica Caldwell said,

"January's sales figures continue a trend of steady, sustainable growth for the auto industry. What's even more encouraging is that this month's figures were less dependent on fleet sales than last year. That means 2011 is already seeing a more robust retail market supported by individual consumers."

Winners and losers

When it comes to increased sales, Chrysler seems to be the clear winner in the January 2011 tables. It's expected to sell 31.6 percent more units than it did last January. It's a shame that other American manufacturers didn't do as well. Ford's rise was 12.8 percent while GM managed 11.1 percent.

Ford and GM didn't compare well with Japanese carmakers, three of which showed bigger gains: Honda (21.3 percent); Toyota (18.8 percent); and Nissan (15.0 percent). However, it's hard not to read the figures as positive news for the American economy as a whole.

Cars back for the Super Bowl

Carmakers and others associated with the auto industry will be well represented during commercial breaks in this Sunday's Super Bowl, according to The Financial Times. It says that they'll be taking up to a third of the available advertising time. And, at between $2.5 million and $3 million for a 30-second ad, that's a sure sign of new life in the car market.

If you feel that now is the time for you to join the countless people who are driving home in new or used cars, then why not get an auto loan quote today?

 

About Author:

Peter Andrew has been writing about -- and for -- business for more than two decades. For the last couple of years, he has found himself increasingly specializing in the U.S. financial sector.