- May 1, 2005
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- 1,788
- Awards
- 12
- First Name
- Jeff
For the full tweet:
What's up with car repossessions?
Let me tell you what we're seeing...
Budget-constrained consumers have had no choice but to purchase "older" cars over the past couple of years.
Record-high car prices combined with the overall lack of inventory have led everyday shoppers to make questionable purchases.
But we're now seeing something interesting develop:
A big uptick of shoppers that are coming in with recent repossessions on their credit history.
When we ask them "what happened?", they tell us that they purchased an "old" car and it broke down, leaving them with a repair bill they couldn't afford.
And guess what happens when people can't afford to repair their car?
You guessed it... They stop making their car payments.
Well, here's the bottom line:
The average age of a used car on the road keeps increasing due to the inventory shortage.
And the majority of America cannot afford a $25K used car, let alone a $48K new car.
The result?
The supply of inexpensive used cars continues to dwindle.
We have 25% fewer used cars on the road vs 2019 — 2.2M vs 2.9M.
This is leaving many budget-constrained consumers with no choice but to purchase older cars that are much more susceptible to mechanical breakdowns.
And — unsurprisingly — it's now becoming clear that selling older cars results in a higher rate of repossessions.
Bookmark this tweet.
We're going to see a lot more of this over the next 12 months.
