Fuel Prices Cause Problems for Car Loans

No one is buying trucks and cars and for an industry where it really is the meat of their profit. Gas prices have made it almost impossible for anyone to afford anything more than your standard sedan because of the amount of gasoline that they use.

The problem is that with high gas prices comes less of a willingness to purchase a high gas consumption car. This means less large vehicle purchases, and ultimately less car loans.

The automotive industry says that they have already seen the difference in their auto loan sales. They say that it has become very difficult for customers to get access to credit, so they are getting fewer approvals for auto loans.

With auto loans and sales having dropped 11% over last year, they are on course now for their lowest volume of sales since the early 1990’s. Tighter restrictions on car loans will make it tougher for their normal customers to get credit, and the less sales that they get the less credit they offer.

Industry experts say that if the auto loan business stays the way it has been, they can expect to lose at least another 10% in sales before the end of their fiscal year. This basically means that they are looking at a long road to recovery that probably won’t even start until mid next year.





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