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vedaauto.com Automotive Credit Demand Index – January 2010
11 February 2010
- Business vehicle credit demand down 40% month-on-month as stimulus ends
- Used vehicle credit demand almost halves - down 48% year-on-year
11 February 2010: vedaauto.com's Automotive Credit Demand Index* for January reveals declines in overall vehicle credit demand for the first time in six months**.
Whilst credit enquiries for business car loans remained above recorded levels from January 2009, up by 4% in January 2010, they fell by 40%, when compared to the previous month of December 2009.
David Scognamiglio, Head of vedaauto.com, said that while the automotive credit demand declines in January were dramatic, this is an anticipated after-effect of the end of last year's Government tax incentives for the car industry. "Businesses in the market for new vehicles simply brought forward their purchase decisions to December 2009 to take advantage of the tax break," he said.
Used vehicle credit demand dropped 12% when compared to December 2009 and almost halved over the past 12 months dropping 49% from 2008 levels. "Considerable year-on-year declines in the used car market can be attributed to the effect of Government tax incentives designed to help the new car industry. We predict an increased demand for the used car sector in the coming months as consumers take advantage of some great deals, driven by an influx of businesses putting used cars on the market after recent fleet purchases," Mr Scognamiglio said.
Personal automotive credit applications increased by 17% in January 2010, over December 2009, but failed to stem the decline in overall vehicle credit demand - which was down by 8% month on month.
Mr Scognamiglio said strong monthly growth in personal vehicle credit finance, in January reflects consumers taking advantage of end of year car sales offers, a reduction in luxury vehicle tax, and an economy which is slowly improving. "As expected, January is a popular trading month for car purchasing Australians, although we didn't see levels as high as in previous years," he said.
Additional data for January 2010:
- Personal automotive credit fell by 13% year-on-year (YOY), while business automotive credit increased marginally by 3.4% YOY.
- Overall vehicle credit demand down 8.5% YOY.
- The average loan amount for personal and business credit applications in January rose marginally year-on-year, increasing by $86 to $21,219 for personal loans and by $960 to $42,814 for business in January 2010.
- The used car market experienced a considerable decline in credit demand, down by almost half (48%) over the number of applications experienced in January 2009.
- All states recorded decreases in total vehicle credit demand YOY, with the exception of ACT (2% increase). NSW recorded a 9.7% decrease, followed by QLD (8.7%) and VIC (8.5%).
- In January, more automotive credit applications were made by males (60%) than females (40%).
- Most age demographics reported a YOY decrease in January 2010; 18-24's fell by 16%, 25 to 24 year-olds fell by 11%, 35 to 44 year-olds fell by 7%, 44-55 year-olds fell by 4%, and 55 to 64 year-olds fell by 2%. Credit demand for consumers aged 65 was up 3.8% year-on-year, the only age group to increase demand during this time.
*vedaauto.com data is compiled by assessing Veda credit applications, combined with National Vehicle Information System (NVIS)**figures from the last three years.
Source: Vedaauto.com Analysis 2010
-Ends-
The www.vedaauto.com credit index was completed using August 2006 as the starting reference month. Commentary may be provided by referencing depersonalised data cubes for year-on-year analysis (YOY). Data analysed is drawn by referencing anonymised credit enquiry data from the Veda Advantage Consumer Credit Reporting Database.
The Database includes application data from all significant lenders in Australia and distinguishes between personal and business applications for credit. The Database records relevant to this study are: gender of credit applicant, age of credit applicant, residential address of applicant (Post Code), amount of credit application.
Demand indices reflect credit enquiries and not approved credit applications. Data is referenced and checked against Federal Chamber of Automated Industries (FCAI) public VFacts data to determine credit demand correlation to new vehicle total sales. The vedaauto.com Used Car Indicator is a unique data set, new to the Australian market, and tracks significant trends around credit demand for used vehicles over the calendar year.
Media Information:
Kevin Burke (02) 9492 1042 or mobile: 0415 945 869 email: Kevin@launchgroup.com.au
Sally Robertson (02) 9492 1089 or mobile: 0400 927 003 email: Sally@launchgroup.com.au
About Veda Auto www.vedaauto.com. Twitter page: http://twitter.com/VedaAuto. Veda Auto is a business division of Veda Advantage Information Services and Solutions Limited ABN 26 000 602 862. Veda Auto delivers vehicle information solutions to motor dealers, insurance firms, finance companies and consumers. Veda Auto aims to help reduce fraud and improve transparency in the sale and purchase of second hand vehicles in Australia, to the benefit of both businesses and consumers alike. Veda Auto sources data from the National Vehicle Information System (NVIS) and Government databases to compile the most comprehensive report possible (as based on available datasets) on the history of a motor vehicle.
*The National Vehicle Information System (NVIS) holds information on millions of vehicles that have been registered in Australia. It is the only comprehensive vehicle history database in operation in Australia. The NVIS is maintained and operated by Veda Advantage Ltd, the owner of Australia's leading consumer and commercial credit information bureau.
About Veda Advantage www.vedaadvantage.com. Veda Advantage has been at the forefront of the information services industry for many decades. Issues such as privacy, data security, fraud and business intelligence are part of our commercial landscape. Veda Advantage holds the country's largest database of credit files for more than 16.5 million credit-active Australians. The vast majority of applications for credit in Australia are checked against the files held by Veda Advantage - providing businesses with the information and knowledge to assist them in making informed decision in customer acquisition and credit risk management.
DISCLAIMER
Purpose of Veda Advantage media releases:
The information in this release is not intended to provide guidance or commentary as to Veda Advantage's financial position nor does it constitute legal, accounting or other professional financial advice. The information may change (based on the datasets available) and Veda Advantage does not guarantee the currency or accuracy of its sourced data. To the extent permitted by law, Veda Advantage specifically excludes all liability or responsibility for any loss or damage arising out of reliance on information in this release and the data in this report, including any consequential or indirect loss, loss of profit, loss of revenue or loss of business opportunity.
