AutoNation CEO says subprime poses no threat
AutoNation CEO Mike Jackson told CNBC that subprime auto loans are not a problem for the auto industry, even though Wells Fargo said it would limit subprime loans to 10 percent of its loan portfolio.
Experian recently reported that 25 percent of new auto loans have terms running six or seven years. But Jackson noted that looking at leasing together with financing yields a different picture. If both are included, average finance terms have fallen from 57 to 56 months, he added.
Delinquency rates on subprime loans average 5 percent versus 3.5 percent for all loans.Download Bulletin PDF