Ford Sees More Car Buyers Falling Behind on Loans
Ford drivers are missing their car payments at an increasing rate, according to the auto manufacturer’s top money man.
“We are seeing delinquencies start to increase,” John Lawler, Ford’s chief financial officer reportedly said at a recent conference hosted by Deutsche Bank.
His comments come as average loan payments are on the rise, which could brew trouble amid a possible recession. But Lawler is not exactly sounding the alarm. At least not yet.
“It’s not yet a concern for us because, coming out of last year and through the first part of this year, they were very low,” Lawler said, according to the New York Post. “It seems like we’re reverting back more towards the mean.”
Monthly car loan payments reached an average of $653 in June, a record high, according to data compiled by Edmunds. Nearly 13% of new car buyers financed at upwards of $1,000 a month, also a new record and roughly three times the share just two years earlier.
The average annual interest rate hit 5.1% in June, while car loans stretched for 70.8 months.
Lawler said Ford is keeping a close eye on inflation, the rising price of vehicles stemming from the semiconductor chip shortage and the recent economic downturn.
“So we are seeing some headwinds there a little bit when it comes to delinquencies as maybe a leading indicator,” he said.
While other major auto manufacturers saw sales slip in the second quarter, Ford got a slight bump from buyers during the three-month span. That was thanks in part to surging demand for new Ford Broncos.
Defective Car? Know Your Rights
Meanwhile, Ford and other car manufacturers are still struggling when it comes to ensuring that their vehicles are actually safe to drive.
The company recently recalled nearly 50,000 Mustang Mach-E vehicles over a defect that could cause the electric cars to lose power without warning, increasing the risk of a crash.
The world’s largest auto manufacturers call back millions of vehicles every year, citing a wide range of defects that put people’s safety at risk.
Fortunately, car owners and lessors in California do not have to wait for a recall in order to get malfunctioning vehicles repaired.
The California lemon law requires carmakers to perform various repairs on vehicles while they are under warranty. It also forces them to buy back vehicles that the companies are unable or simply unwilling to fix. That includes covering the purchase price and monthly payments, as well as picking up the tab for rental cars and other related expenses.
Speak with a Lemon Law Attorney Today
If you have been stuck with a defective or malfunctioning vehicle or are haggling with a car manufacturer over repairs, the California lemon lawyers at Bickel Sannipoli APC can help you fight back.