December 2025, Vol. 28, Issue 6
I hope you like, or at least can tolerate, numbers because you’ll find a lot of them in this article. Oxford Economics, a UK-based global advisory firm, wrote a report for the American Financial Services Association on the economic impact of vehicle financing in the United States. While the report includes no earth-shattering revelations, it does provide a reminder of the important role of vehicle financing in this country’s economy.
Vehicle financing companies provided $727 billion worth of financing to U.S. households in 2023, according to the Oxford Economics report, which uses estimates from Equifax. That figure represents a 9.3% increase compared to 2019, although it is unclear whether that 9.3% is in nominal or real dollars (inflation was significantly above 9.3% between 2019 and 2023, according to the Federal Reserve Bank of Minneapolis). The report, which covers consumer-purpose financing but not commercial-purpose financing, states that, in 2023, Americans purchased 79% of new vehicles and 42% of used vehicles with financing. Financed sales and leases, the report claims, contributed $532 billion to U.S. GDP, $125.5 billion of which was attributable to the activities of vehicle finance companies. According to the report, these activities supported $16.3 billion in federal taxes and $8.3 billion in state and local taxes. The report states that vehicle financing contracts accounted for 9% of outstanding consumer debt in 2023, with only mortgage loans taking a larger share.
The Oxford Economics report also details where, geographically and economically, vehicle financing is most concentrated. According to the report, financing issued in California, Florida, Georgia, New York, and Texas accounted for a combined 40% of U.S. vehicle financing value in 2023. The report states that 66% of financing value and 62% of originations went to customers with prime credit scores, 23% of value and 23% of originations went to customers with neither prime nor subprime credit scores (by subtraction of the “subprime” figures from the “nonprime” figures), and 11% of value and 15% of originations went to customers with subprime credit scores.
What do all these numbers mean? They mean that vehicle financing is everywhere in this country, and people across the credit score spectrum use it. The COVID-19 pandemic affected the vehicle financing industry just as it affected every other industry, but the industry has recovered. Access to a vehicle is a necessity in most parts of the country, and access to financing is often necessary to gain access to a vehicle. For these reasons, vehicle financing is an important part of the American economy and will likely remain so for decades to come. These conclusions probably come as no surprise to anyone reading this article, but it’s good to know that the data support what we in the industry experience.
CounselorLibrary.com, LLC, provides articles on its website written by attorneys with Hudson Cook, LLP, and by other authors, for information purposes only. CounselorLibrary.com, LLC, and Hudson Cook, LLP, do not warrant the accuracy or completeness of the articles, and have no duty to correct or update information contained on the CounselorLibrary.com website. The views and opinions contained in the articles do not constitute the views and opinions of CounselorLibrary.com, LLC, or Hudson Cook, LLP. Such articles do not constitute legal advice from such authors or from Hudson Cook, LLP, or CounselorLibrary.com, LLC. For legal advice on a matter, one should seek the advice of legal counsel.
Copyright © 2025 CounselorLibrary.com, LLC. All rights reserved.
