TransUnion issues new analysis of auto market during AFSA Vehicle Finance Conference

Over the coming year, many consumers considering an auto loan or lease may be reentering the market with far more complicated credit pictures than they did, even just a few years ago. The findings come from a new analysis released by TransUnion (NYSE: TRU) in conjunction with the 2025 AFSA Vehicle Finance Conference in New Orleans.

TransUnion’s recently released Consumer Pulse Study found that among consumers who said they’re planning to apply for new credit or refinance existing credit by Oct. 2025, nearly one in four intend to shop for a new auto loan or lease in that time period. The same survey showed that 31% of consumers believed their finances were better than expected at the time of the Oct. 2024 survey than at the start of that year. As such, it’s critically important that lenders thoroughly assess the creditworthiness of potential borrowers and maintain awareness of the credit portfolios of existing borrowers.

“As the macroeconomy stabilizes and we begin to see a return to more typical economic patterns, consumers may return to a more manageable financial state, one which may lead many to re-engage with the auto market,” said Jason Laky, executive vice president and head of financial services at TransUnion. “However, given the unusual nature of the consumer economy during the pandemic era and the immediate years following, it’s going to be imperative that lenders use every tool at their disposal to ensure those consumers to whom they are lending are risk-appropriate and in a position to make continued payments.”

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Millennials may be among the most active shoppers. TransUnion’s most recent Consumer Pulse revealed that this demographic group was the most likely to purchase an auto. Approximately 31% of Millennials indicated they were very or somewhat likely to do so from Oct. 2024 to Jan. 2025. This is 10 percentage points higher than the second highest group, Gen Z.

In that same Q4 2024 survey, only about four in 10 Millennials indicated that their finances were better than anticipated at the start of 2024. The paradigm mentioned above is not exclusive to Millennials, and it underscores the need for lenders to examine consumers more closely when assessing risk and to use all of the tools and resources they have access to when doing so.

“In TransUnion’s recently released 2025 Consumer Credit Forecast, we observed that auto delinquency is expected to tick down in 2025,” said Satyan Merchant, senior vice president and auto and mortgage business lead at TransUnion. “However, lenders play a critical role in helping realize that decline. One way is by ensuring that potential and existing borrowers are in a financial position to avoid these delinquencies. Lenders can utilize tools and resources that make it easier to get a comprehensive understanding of the market and its consumers and make informed, data-backed decisions.”

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As they consider extending auto loans to customers in 2025, lenders must consider a wide range of critical factors such as:

• Their optimization of underwriting and pricing strategies
• Loan-to-value criteria, both their own and that of other lenders
• Market share and industry patterns within their target segment
• Managing dealer relationships and developing strategies to expand their networks
• Monitoring portfolio health and loss forecasting

One tool that can assist lenders in isolating these factors is AutoCreditInsight^TM, powered by TransUnion in partnership with S&P Global Mobility. AutoCreditInsight delivers depersonalized credit data—such as risk tiers and original loan terms—paired with comprehensive, accurate and timely vehicle registration. Through its interactive user interface, lenders can create custom visualizations and perform detailed statistical queries, reporting and analysis to make more informed decisions faster.

In addition, the new AutoCreditInsight Vintage Analysis solution, an expansion of the existing AutoCreditInsight suite, combines vehicle, credit, and delinquency data to allow lenders to evaluate overall market loan performance trends and benchmark individual portfolio performance at the industry and peer group level.

“While it’s imperative that lenders are prepared for the potential increase in auto purchases, it’s equally important that consumers work to ensure that their credit profile is as buttoned up as possible to ensure a positive car buying experience,” continued Merchant. “This means being fully aware of what is on their credit reports, and making on-time payments on existing credit accounts.”