Auto lenders, dealers look to tax season for boost

Auto dealers are expecting a strong tax season to spur a sales jolt early this year, but lenders and dealers are split on their full-year outlook amid rising vehicle prices and macroeconomic challenges facing consumers.

Other factors that market participants are monitoring include how fluctuating interest rates and unemployment will affect consumer affordability and car sales.

In fact, December 2025 sales were projected to fall 3.5% year over year to 1.4 million, according to Cox Automotive. Those figures will be released later this month.

However, 2025 new-vehicle sales reached the best level in six years, according to a Cox Auto Dec. 17 report. Full-year sales were projected to increase 1.8% in 2025 compared with 2024, according to Kelley Blue Book estimates.

At the same time, credit access improved in 2025 as fewer banks reported tightening their lending standards. The auto loan rejection rate, however, climbed 1 percentage point YoY in October 2025 to 15.2%.

Still, retailers such as Tempe, Ariz.-based DriveTime are eyeing growth in 2026 as they navigate the changing auto landscape. Chief Executive Mary Leigh Phillips told Auto Finance News that DriveTime is eyeing double-digit growth across its subsidiaries.

Tricolor effects

Among the changes the auto industry will navigate in 2026 are the effects of Tricolor Auto’s collapse, which is still playing out in court. At today’s court hearing, backup servicer Vervent’s responsibilities were outlined and permission was granted for Vervent to use Tricolor funds to pay collateral insurance protection and Texas seller-finance sales taxes.

Read AFN’s top 5 Tricolor stories in 2025.

Listen as Auto Finance News Senior Associate Editor Truth Headlam and Associate Editor Aidan Bush unpack recent auto finance news and provide a look at the year ahead.

Subscribe to “The Roadmap Podcast” on iTunes or Spotify or download the episode.

Denne episoden er hentet fra en åpen RSS-feed og er ikke publisert av Podme. Den kan derfor inneholde annonser.

Episoder(335)

Chase Auto head of pricing, credit strategy says granular decisioning key

Auto lenders must strengthen fraud controls, improve operational processes and lean more into precise, data-based decision-making as they look toward 2027, Manish Chhabra, head of auto pricing and cre...

15 Sep 12min

GM Financial's Kyle Birch reflects on captive build-out, career ahead of retirement

Communication is key to GM Financial's continued success under new leadership, according to retiring GM Financial President of North America Operations Kyle Birch. "There'll always be challenges for l...

19 Aug 18min

Arivo Acceptance eyes increased auto ABS cadence

The auto asset-backed securitization market remains resilient as a funding outlet for many issuers and originators. “It's an important source of capital for us,” Michael Gustafson, chief financial of...

10 Aug 19min

Ally Financial, Capital One, Huntington Bank auto originations mixed

Ally Financial, Capital One and Huntington Bank posted mixed results in the second quarter for auto originations and credit performance. Ally Financial’s auto originations rose 20.9% year over year i...

27 Jul 7min

Wells Fargo Auto, Chase Auto originations jump in Q2

National and regional bank second-quarter earnings point to mixed performance as larger banks lean into auto production while regional banks held steady or scaled back amid market volatility. Wells F...

20 Jul 6min

Subaru Motors Finance to target first-time buyers, expand credit access

Subaru Motors Finance plans to expand its underwriting to attract more first-time buyers, Managing Director Michael Cottone tells Auto Finance News in the latest episode of “The Auto Finance Roadmap P...

13 Jul 23min

BMW Financial’s lease penetration normalizes post-EV tax credit

BMW Financial Services’ lease penetration has normalized following the elimination of the federal electric vehicle tax credit, says Ole Jensen, chief executive and president of the captive in North Am...

6 Jul 23min

Rising insurance costs add to affordability woes

Car buyers are facing a tough market as rising insurance costs add to vehicle ownership expenses and lenders are mindful of high loan-to-value ratios. The national six-month auto insurance premium ro...

29 Jun 11min