Jeremy Acevedo, Edmunds’ manager of industry analysis, says average interest rates on new-vehicle financing will likely climb in the next few months. Photo credit: Kat Tuohy Photography
Zero-percent financing deals reappeared for Black Friday, but they won’t last long, according to Edmunds.
Holiday deals in November temporarily brought 0 percent financing deals — which had all but dried up in the month earlier — back to showroom floors, but that relief for customers will likely subside by year end, said Jeremy Acevedo, Edmunds’ manager of industry analysis.
“It’s an expensive endeavor for automakers but one that will help move the market share needle,” Acevedo told Automotive News. “The auto industry is trying to figure out what will work for them to maintain healthy levels of demand and trying to see what kind of deals resonate with shoppers.”
Black Friday deals
Despite the rise from months earlier, 0 percent financing — at 5.5 percent of new-vehicle loans — was at its lowest November level since 2005, Edmunds said.
The resurgence of 0 percent financing for Black Friday deals pulled down the average interest rate on new-vehicle loans from the month earlier, but rates still grew year over year and will likely continue to rise.
At about 6 percent, the average new-vehicle interest rate in November dipped only slightly from October’s 6.21 percent average. But, it remains high compared with a year earlier when the average new-vehicle interest rate was 4.81 percent.