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North America Used Car Financing Market Size (2024 - 2029)

The North American used car financing market is experiencing significant growth, driven by factors such as the resurgence post-COVID-19, the dominance of luxury car sales, and the increasing availability of diverse financing options. The market's expansion is particularly notable in the United States, where high income levels and a preference for luxury sedans in the used car segment have boosted the demand for financing services. This trend is expected to continue, with the market size expanding as more consumers seek to alleviate financial burdens through financing solutions.

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Market Size of North America Used Car Financing Industry

North America Used Car Financing Market Summary
Study Period 2019 - 2029
Base Year For Estimation 2023
Forecast Data Period 2024 - 2029
Historical Data Period 2019 - 2022
CAGR 8.26 %
Market Concentration Medium

Major Players

North America Used Car Financing Market Major Players

*Disclaimer: Major Players sorted in no particular order

North America Used Car Financing Market Analysis

The North American Used Car Financing Market is valued at USD 259.71 billion and is expected to reach USD 413.23 billion over the coming five years, with a combined CAGR of 8.26% during the same period.

During COVID-19, North America's used car financing witnessed a steady decline, owing to the spread of the virus, and people avoided purchasing cars amid an economic slowdown. In addition, markets, showrooms, and auction events were closed as strict lockdown measures were imposed by the regional government. Although, after Q1 2021, everything was again on track, with the used car financing business back to a growth phase again.

The region is dominated by luxury case sales, which has been the key factor driving the used car financing marketplace. The consumer who opts to purchase luxury cars looks for a used car option to witness a reduction in the overall cost. This has helped the financiers to offer better interest rates and get ownership of the same. Several factors have influenced the growth of the market, including the pandemic, changing demographics and ambitions, the addition of first-time buyers, and the availability of various financing options by companies across the used car landscape.

Considering these factors, the United States is anticipated to hold the highest growth rate in the used car financing market in North America. People in the United States exhibit the highest income and are more exposed to owing luxury sedans in the used car segment. This has elevated the combined demand for financing services to ease the financial burden on individuals.

Considering these factors, the demand for used car financing in North America is expected to witness a high growth rate during the forecast period.

North America Used Car Financing Industry Segmentation

Used car financing is the service that offers used cars to consumers at much-lowered prices with affordable EMI installments. These installments are divided based on the loan amount and tenure with some fixed rate of interest.

The North American Used Car Financing Market is segmented by Car Type (Hatchbacks, Sedans, Sports Utility Vehicle, and Multi-purpose Vehicle), by Financier (OEM, Banks, and Non-Banking Financing Companies), and by Country (United States, Canada, Mexico, and Rest of North America). For each segment, the market sizing and forecasts have been provided on the basis of value (in USD million) and volume (in metric tons).

By Car Type
Hachbacks
Sedan
Sports Utility vehicles (SUV)
Multi-Purpose Vehicle
By Financier
OEM
Banks
Non-Banking Financial Companies
By Country
United States
Canada
Mexico
Rest of North America
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North America Used Car Financing Market Size Summary

The North American used car financing market is poised for significant growth, driven by a resurgence in consumer demand post-COVID-19. The market, which experienced a temporary decline during the pandemic due to economic uncertainties and lockdowns, has rebounded as consumers shifted towards more affordable vehicle options. The preference for luxury used cars, coupled with attractive financing options, has been a key driver in this recovery. The United States is expected to lead in growth, supported by high-income consumers seeking luxury sedans. The emergence of OEM-certified used cars and various dealer channels has further bolstered consumer confidence, offering quality assurance and better financing terms. The market landscape is characterized by a mix of bank-owned and auto-owned financing companies, each leveraging their unique strengths to capture market share.

In Canada, the demand for used car financing is anticipated to grow robustly, fueled by a shift towards personal vehicle ownership and the popularity of budget-friendly SUVs. Non-banking financial firms and major banks are actively offering competitive financing solutions, making it easier for consumers to purchase used cars. The trend towards OEM-certified vehicles is gaining traction, as consumers prefer the added security and benefits these options provide. The market is moderately consolidated, with both organized and unorganized players vying for dominance. Strategic partnerships and financing initiatives, such as those by Kavak and MercadoLibre, are enhancing the availability of used car loans across the region. Overall, the North American used car financing market is set for substantial expansion, driven by consumer preferences, strategic financial offerings, and a focus on affordability.

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North America Used Car Financing Market Size - Table of Contents

  1. 1. MARKET DYNAMICS

    1. 1.1 Market Drivers

    2. 1.2 Market Restraints

    3. 1.3 Porters Five Force Analysis

      1. 1.3.1 Threat of New Entrants

      2. 1.3.2 Bargaining Power of Buyers/Consumers

      3. 1.3.3 Bargaining Power of Suppliers

      4. 1.3.4 Threat of Substitute Products

      5. 1.3.5 Intensity of Competitive Rivalry

  2. 2. MARKET SEGMENTATION (Market Size in Value USD Billion)

    1. 2.1 By Car Type

      1. 2.1.1 Hachbacks

      2. 2.1.2 Sedan

      3. 2.1.3 Sports Utility vehicles (SUV)

      4. 2.1.4 Multi-Purpose Vehicle

      5. 2.1.5

    2. 2.2 By Financier

      1. 2.2.1 OEM

      2. 2.2.2 Banks

      3. 2.2.3 Non-Banking Financial Companies

    3. 2.3 By Country

      1. 2.3.1 United States

      2. 2.3.2 Canada

      3. 2.3.3 Mexico

      4. 2.3.4 Rest of North America

North America Used Car Financing Market Size FAQs

The North America Used Car Financing Market is projected to register a CAGR of 8.26% during the forecast period (2024-2029)

Ally Financial Inc., The Bank of America Corporation, Capital One Financial Corporation, Citigroup Inc. and Royal Bank of Canada are the major companies operating in the North America Used Car Financing Market.

North America Used Car Financing Report Snapshots

North America Used Car Financing Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)