The car finance market has grown significantly, rising from $276.55 billion in 2023 to $298.38 billion in 2024, reflecting a CAGR of 7.9%. This growth is attributed to regulatory changes, economic conditions, improved vehicle affordability, shifting ownership preferences, and urbanization. The market is projected to reach $406.25 billion by 2028, with a CAGR of 8%. Future growth will be influenced by evolving consumer preferences, environmental regulations, demographic shifts, global economic conditions, and the adoption of electric vehicles. Notable trends include digital transformation, artificial intelligence integration, digital platforms adoption, machine learning, and personalized financing solutions.
Major Driver In The Car Finance Market
The rise in vehicle prices is expected to boost the car finance market. Increasing vehicle prices, driven by factors such as raw material costs, inflation, and manufacturing expenses, are prompting consumers to seek financial solutions to purchase vehicles. Car finance options, including loans and leases, allow buyers to manage vehicle costs over time. For example, in January 2023, JP Morgan reported that the average expenditure on a new car in the U.S. was $46,437, marking a 4.2% increase from the previous year. This rise in vehicle prices is expected to drive the car finance market.
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Car Finance Market Competitive Landscape
Ford Motor Credit Company LLC, JPMorgan Chase Bank, Bank of America, Wells Fargo Auto, Volkswagen Financial Services AG, BNP Paribas S.A., Capital One Bank, PACCAR Financial Corp., The Bank of Nova Scotia (Scotiabank), General Motors Financial Company Inc., Ally Bank (Ally Financial), Fifth Third Bank, Citizens Financial Group Inc., Santander Consumer USA Holdings Inc., BBVA USA (BBVA), KeyBank National Association (KeyBank), Hyundai Motor Finance Company, Toyota Financial Services, American Honda Finance Corporation (Honda Financial Services), TD Auto Finance LLC, Chrysler Capital, Mercedes-Benz Financial Services USA LLC, Nissan Motor Acceptance Corporation (Nissan Motor Acceptance Company LLC), The Huntington National Bank (Huntington Financial), BMW Financial Services LLC
Key Car Finance Market Trend
Companies in the car finance market are embracing online platforms to streamline the loan application process. In March 2022, MG Motor India launched MG e-Pay, an online car finance platform that allows customers to conveniently apply for and manage car loans, significantly enhancing the customer experience and making the financing process more efficient.
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Car Finance Market Segmentation
The car finance market covered in this report is segmented –
1) By Type: Loans, Leases, Other Types
2) By Vehicle Age: New Vehicle, Used Vehicle
3) By Distribution Channel: Banks, Original Equipment Manufacturer (OEMs), Credit Unions, Other Distribution Channels
4) By Application: Personal, Commercial
By Geography:The regions covered in the car finance market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.
North America was the largest region in the car finance market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period.
The Car Finance Global Market Report 2024 furnishes information about the global car finance market, encompassing details like market size, projections for growth, segmentation across various sectors and regions, and an overview of competitors, including their revenues, profiles, and market shares. Furthermore, the report pinpoints potential opportunities and strategic directions derived from market trends and the strategies adopted by key competitors. The report also offers an assessment of how the COVID-19 pandemic, the Russia-Ukraine conflict, and increasing inflation have affected both global and regional markets, furnishing valuable strategic insights for businesses.
