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Below-Prime Car Buyers Less Loyal Than Average Car Buyers

January 14, 2014

IRVINE, Calif. — Below-prime car buyers are less loyal than the average car buyer, according to a brand loyal report released this week by It shows that such shoppers are making practical choices as they re-enter the market, as well as trading in slightly younger vehicles this year than last.

The report lists the Top 5 brands for loyalty and purchase, as well as the most traded in model years for below-prime car buyers. Based on an analysis of trade-in data from January 2013 to September 2013, the report offers a unique snapshot of the large population of car-buyers who fall in the below-prime credit tier. 

“Given that over half of all used and over one in four new car loans today go to below-prime consumer, this is data that both automakers and consumers might want to take note of,” said CEO Jim Landy. “These buyers, who are getting back on their feet, are contributing to the auto industry recovery, and this report provides a view of the brands these consumers are relying on — and trust — the most.”

Below-prime car buyers, according to the report, are most loyal to Kia overall, although Nissan was a strong second. When looking at the brands consumers are buying most when trading in, Chevrolet came in at No. 1, followed by Ford. So, while import brands score highest for loyalty, it is the domestics that these buyers are opting for more than any other brand. 

And given that brand loyalty for this buyer is almost half that (24%) of the average buyer (44%), Chevrolet’s strong showing is significant. The OEMs recent introduction of competitively priced, feature-rich sedans with good fuel economy, such as the Cruze and Malibu, is resonating with below-prime consumers. 

In addition, the data offers an interesting picture of the age of the vehicles being traded in by these buyers. While the average age of a vehicle on the road today is 11.4 years, the average age of a vehicle traded in by these below-prime car buyers is 8.8 years, a 6% decrease from the previous year’s 9.4. The model traded in the most was 2006, while the Top 5 years traded in all predate the recession.

“The data continues to demonstrate that these buyers are making practical choices,” Landy said. “While these buyers are not particularly brand loyal, they favor brands that offer competitively priced vehicles with the must-have features that today’s consumers demand. They are also showing more confidence about reentering the market, as evidenced by the fact that the age of their trade-ins is decreasing.”

Below-Prime Car Buyer Loyalty: Top Five Brands Overall (Car owners traded-in current brands for same brand.)

1. Kia

2. Nissan

3. Dodge

4. Chevrolet

5. Ford

The inroads made by domestic brands in recent years, with their small and mid-sized sedans, are also resonating with this segment. Together with their continued strong truck offerings, Dodge, Chevrolet and Ford are continuing to command loyalty with the below-prime car buyer.

Below Prime Car-Buyers: Top 5 Model Years Traded In  

The average age overall of cars traded in by these buyers is 8.8 years, and it is worth noting that the top five model years are all pre-recession models.  While it is possible that some of the buyers did not own the vehicles for the full life span, they are trading in well under the average age of vehicles in the general population, i.e. these consumers are not holding on until their vehicles die. This indicates increased confidence among these buyers about entering the market — and when their vehicles are still viable trade-ins.

1. 2006   

2. 2007   

3. 2008

4. 2005

5. 2004

The Below-Prime Brand Loyalty Report is based on an analysis of funded loans used to purchase a new or used vehicle and where a trade-in was part of the transaction.  The data analyzed covered the first three quarters of 2013.

To access the full report, click here.


  1. 1. Lee [ January 15, 2014 @ 09:34AM ]

    Subprime buyers aren't holding onto their vehicles as long, because they're trading to trade into better interest rates. As far as brand loyalties go, I think needs to open their eyes & realize that most buyers have brand loyalties... until they're unable to be approved by their dealer of choice due to higher priced import autos that offer very little rebate incentives from the manufacturers.

    And the #1 reason that Chevrolet is leading the subprime segment is due to having an incredible partnership with their GM/AmeriCredit financing division that offers extremely low rates & fantastic rebates for subprime & all other buyers alike.

    In my 20+ years in this business, I've found that most buyers used to gravitate more toward imports when possible (along with the gentle push toward imports by auto dealers due to most subprime lenders offering increased front-end advances and/or longer loan terms on import autos). However, I've seen a drastic uptick in credit applications at domestic dealerships within the last 7 years, due to improved domestic styling & build quality too.

    I think the group that created this study really don't understand that subprime borrowers simply look for the cheapest payments or blend of best "bang for their buck" when buying autos due to extremely high interest rates.

    I'd like to see what some of our other industry veterans think about this report too.


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