The average price consumers paid for new vehicles reached a record high of $48,182 in July of 2022 while the average price of used vehicles is $28,219, just below the record high set in April 2022. As seen in the graph below, prices for vehicles increased over the past two years, especially throughout 2021.
New and Used Vehicle Prices
When looking at delinquency in the first two years after purchase, loans originated in 2021 and 2022 are starting to show higher delinquency rates relative to loans originated in previous years, even when compared to loans unaffected by pandemic-related stimulus payments. For example, auto loans originated in 2021 have a delinquency rate of 0.67 percent in the sixth quarter after origination, which is 13 percent higher than the delinquency rate of auto loans originated in 2018.
As shown in the lead chart, this trend is even more pronounced for consumers with subprime and deep subprime credit scores.
For example, 2022 vintage auto loans for consumers with deep subprime credit scores were 2.4 percent delinquent two quarters after origination, which is a 33 percent increase from the previous five-year high set in 2020.