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 is down 2.4% from 15 years ago.1
Average annual expenditures account for 89% of income after taxes (up from 85% 3 years ago).2
65% feel it is important to understand the affordability of the vehicles they are considering.3
66% think monthly payment is most important (vs. 34% final purchase price).4
The average loan term at the end of 2016 was 68.58 months (an all-time high for the last 10 years).17
Check out the other Key Consumer Research insights to learn more.
1. Census Bureau
2. BLS Consumer Expenditure Survey
3. 2016 Cox Automotive Emotional Connections
4. 2016 KBB Dealership Experience Study
17. Dealertrack Credit App Network, Jan 2017