August 29, 2012
Auto Loan Delinquency Rates at Historic Lows
One indicator of the status of our economy is the rate at which car owners are able to make payments, or rather, aren't. The rate at which owners can't get the check in the mail for their new car is called the delinquency rate, and according to a Los Angeles Times report, it has fallen to an all-time low. Credit report entity TransUnion began tracking this data in 1999, which it calculates as the percentage of borrowers 60 or more days past due. Currently that rate was recorded at 0.33 percent for the second quarter of 2012 – down from 0.36 percent in the first quarter and a full 25 percent lower than last year. Auto Blog reports that auto sales in the U.S. have risen 14 percent in the first seven months of 2012 to 8.4 million vehicles. Experts suggest this is a result of more relaxed credit conditions, allowing buyers with poorer credit to find a way to purchase a new car. This trend could eventually result in the delinquency rate climbing back up. Want to know what states have the highest delinquency rates in the country right now? Click here.
U.S. Finalizes 2025 Fuel Rules for Automakers
The Obama administration has finalized the landmark 2017-25 fuel economy rules that will nearly double the efficiency of the nation's cars and trucks over the next 13 years to a fleetwide average of 54.5 miles per gallon. The Detroit News reports that the new rules will reshape what Americans drive — and may prod automakers to add fuel saving technologies at a faster rate. The rules also give automakers credits for building hybrid light trucks and adding fuel saving features that the government didn't take into account in prior years. Under the deal reached during months of secret talks led by former White House auto czar Ron Bloom, the Obama administration agreed to lower fuel economy increases for light trucks to 3.5 percent annually through 2021, while keeping the yearly hike for cars at 5 percent. The National Highway Traffic Safety Administration and the Environmental Protection Agency also agreed to a midterm review to ensure that the final four years of the program are feasible. California also agreed not to impose its own state standards. For a complete breakdown of the new rules, and possible consequences for dealers and manufacturers, click here.
Obama Fuel-Economy Rule Gives Sweeteners to Honda, Tesla
Honda Motor Co. will see a welcome benefit in yesterday’s finalized fuel economy rules. The automaker, which last year complained that a proposed fuel-economy rule was unfair to non- U.S. automakers, got a boost when the final version added extra credits for sellers of natural gas-powered vehicles. Honda, based in Tokyo, is the only automaker selling compressed natural gas-powered cars to U.S. drivers and will be able to use the credits to meet the fuel-economy standards. According to Business Week, it’s one of the few changes made to a rule for 2017 to 2025 that was proposed in November 2011. “Providing incentive credits for natural gas vehicles makes a great deal of sense under this regulation,” Edward Cohen, Honda vice president of government and industry relations, said in an e-mail yesterday. “A dedicated natural gas vehicle reduces CO2 emissions by 25 percent and petroleum consumption by 100 percent.” Small automakers such as Tesla Motors Inc. may benefit from another change written into the final rule that builds on a market California opened this year for sellers of zero-emission vehicles such as plug-ins or those powered by hydrogen. For more on the rules, click here.
25 Cities with the Worst Drivers in 2012
For those of us who live in and/or drive through major metropolitan areas, having to keep a watchful eye out for the antics of inattentive or even reckless drivers is a necessary part of our daily routine. You may think you’ve got it bad, but according to the eighth annual “America’s Best Drivers Report” issued by Allstate Insurance, Washington D.C. can again lay claim to having the absolute worst motorists in the nation. Allstate studied the auto insurance claims frequency of America’s 200 largest cities and found that residents of our nation’s capitol were found to get into collisions on average once every 4.7 years. This means they’re a whopping 112.1 percent more likely to be party to an accident than the typical driver in the U.S., who wrecks his or her car once every 10 years. Forbes reports that taken on a state-wide basis, California would seem to have the worst drivers overall, placing five cities among the top 25, including Glendale (5), San Francisco (10), Los Angeles (14), Fullerton (16), and Torrence (22). New Jersey came in a close second with four cities among the top 25. To see the complete list, and which cities have the best drivers, click here.
Gulf Coast Dealers Move to Protect Vehicles from Hurricane Isaac
As Hurricane Isaac bears down on the Gulf Coast, some car dealers in flood-prone areas of Louisiana are moving their vehicles to safety. Bob Israel, president of the Louisiana Automobile Dealers Association in Baton Rouge, said in an interview with Automotive News that flying debris carried by high winds can damage vehicles, but the biggest concern is flooding. In the Metairie, a New Orleans suburb, dealers who remember the canals overflowing after Hurricane Katrina struck the area seven years ago Wednesday have moved select inventory to higher ground. But other local dealers are waiting out the storm and will be ready to sell vehicles again on Thursday morning. Israel said he spoke with a dealer in the Slidell, La., area Monday who was moving vehicles to the parking lot of a nearby shopping center. "They actually did a rehearsal last Friday, so yesterday, when they started moving cars, it went very smoothly," Israel said. "That's an arrangement through their insurance company. I'm sure everybody that is in an area where the dealership itself is subject to flood tries to find a place to move their cars." For more on how dealers are handling Isaac, click here.
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