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あらすじ・解説
Join host Vince Passione as he meets with Bill Moniz, CEO of Cinch, to discuss the turbulence and trends of the auto finance industry. From the rise of negative equity to prime-only lending strategies, Bill shares insights on how credit unions can navigate credit quality challenges, discusses educating members on financing options, and gives his thoughts on market reactions to an expected Federal rates drop.
Key takeaways:
1:21 - The history of Credit Union Loan Source and Cinch: Two organizations operating as one.
3:07 - ‘Market Day Supply’–the metric used to calculate how many days it would take to sell all of a specific car model–is still higher than long-term trends, but is leveling out to near pre-Covid levels.
6:50 - Almost a quarter of new vehicles financed have negative equity rolled into them.
9:08 - While credit unions’ market share of auto loans has increased over the last two years, so too has delinquencies–increasing risk for credit unions.
10:48 - Consumer debt priorities have changed. Now, cell phone bills are the priority.
12:59 - Could subvention be utilized more effectively in the EV market?
16:23 - Auto-focused fintechs are cutting back, not making as many inroads as they have done in previous years, but direct-to-consumer innovation remains.
18:17 - Inventory management is an underutilized innovation category that could support more auto-purchasing.
19:55 - Personal unsecured loans have underperformed, and this is a concern for lenders and a risk for credit union balance sheets.
21:17 - Auto-lending is a nuanced service that takes time and expertise to navigate successfully.
23:28 - Expectations of what happens if and when the Fed lowers rates.
Resources Mentioned:
- https://site.manheim.com/en/services/consulting/used-vehicle-value-index.html Manheim index
- https://www.businesswire.com/news/home/20240628537547/en/KBRA-Releases-Research-%E2%80%93-CMBS-Loan-Performance-Trends-June-2024 KBRA, delinquencies on asset-backed securities report
- https://www.cbsnews.com/news/cdk-attack-update-outage-car-sales-impact/ CDK outage
- https://www.occ.treas.gov/topics/supervision-and-examination/bank-operations/accounting/current-expected-credit-losses/index-current-expected-credit-losses.html CECL reserves
- https://www.cinchautofinance.com/ Cinch
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#CreditUnions #Lending #AutoFinance #AutoLending