Daily expenses continue to grow at a faster pace than wages and income, leaving consumers with less money to spend on their vehicles. As a result, consumers are putting more focus on monthly payments and signing up for longer loan terms to keep cars within their monthly budget requirements.
Real median household income
-
%
Real median household income is down 2.4% from 15 years ago.1
expenditures as PERCENTAGE OF INCOME
%
Average annual expenditures account for 89% of income after taxes (up from 85% 3 years ago).2
IMPORTANCE OF AFFORDABILITY
%
65% feel it is important to understand the affordability of the vehicles they are considering.3
IMPORTANCE OF
MONTHLY PAYMENT
MONTHLY PAYMENT
%
VS.
IMPORTANCE OF FINAL PURCHASE PRICE
%
66% think monthly payment is most important (vs. 34% final purchase price).4
Average loan term
months
The average loan term at the end of 2016 was 68.58 months (an all-time high for the last 10 years).17
