KBRA releases research that explores the current divergence between auto loan delinquencies and loss rates, as well as our expectation for increasing headwinds for auto loan credit fundamentals over the coming months.
Government stimulus, a strong labor market, and a sharp rise in used vehicle prices helped to push auto loan delinquency and loss rates to historic lows in 2020 and 2021. However, given the recent and expected rate hikes as central banks desperately battle inflation, improving vehicle manufacturing logistics, and strong recessionary signals, the benign credit environment of the past two years may be in the rearview mirror.
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KBRA is a full-service credit rating agency registered in the U.S., the EU, and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.
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Brian Ford, CFA, Managing Director
Structured Finance Research
+1 (646) 731-2329
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