vedaauto.com Automotive Credit Demand Index – December 2009

vedaauto.com's monthly Automotive Credit Demand Index* for December reveals overall automotive credit demand continued to rise across the final quarter of 2009, with a 10% increase compared to December 2008. Business vehicle credit applications drove the growth in demand, jumping by 74% when compared to December 2008 - reflecting the impact of the Government's Small and General Business Tax Break for new car purchases.
While overall automotive credit demand rose a modest 0.9% in December compared to November 2009, business vehicle credit applications increased 20.6% over the previous month. The average loan amount for new car business credit applications also rose across the year, increasing by $1,462 from $43,471 in 2008 to an average of $44,933 in 2009. Loan application amounts spiked to an average of $46,111 in the final quarter of 2009.
Credit demand for personal new car loans continued a downward trend in December, falling by 10.6% in December from November 2009, and 14.7% year-on-year. Used vehicle credit demand also continued to fall, decreasing by 7.3% year-on-year, and 6.7% from the previous month of November.
The vedaauto.com Credit Demand Index provides details on monthly automotive credit applications made by consumers and businesses, offering insights into auto demand in Australia.
Head of vedaauto.com, David Scognamiglio, said the Government automotive stimulus package for consumers with Australian Business Numbers has had a significant impact on the car market.
"The Government incentive program has been a success and the impact will continue to support jobs in the auto industry into the start of 2010, as the industry delivers on vehicles which have been ordered under the incentive scheme. However, with the 50% tax deduction on new vehicles for businesses ending last year on December 31, we expect to see a significant softening in automotive credit demand for new cars in January and in the first half of 2010.
"The increase in business automotive credit demand should also result in an abundance of used cars being advertised online through motor dealers, as businesses deliver their traded-in vehicles when taking delivery of their new vehicles in 2010. This could see an oversupply of used cars, and some great deals in the used-car market this year, Mr Scognamiglio said. 
Additional data for December 2009:
•All Australian states recorded increases in vehicle credit demand compared to the same month last year - ACT had the biggest year-on-year (YOY) increase (18.8%) followed by NSW (12.1%) and Victoria (10.8%).
•Males were more active in seeking credit for vehicles than females - male enquiries increased 12.5%, while female enquiries increased 4.7% from December 2008.
•While the 18-34 age demographic reported December decreases YOY, older consumers have remained very active - auto enquiries from 55-64 year olds increased by 39.3%, followed by the 65+ age group (35.3%) and 45-54 year olds (26.7%).
•The average amount of each new business car loan also increased over the year, up by 7.4% or $3,195, from $42,895 to $46,090 in December YOY. The average personal car loan in December also increased 0.4% YOY, from $21,406 to current levels of $21,501.
*vedaauto.com data is compiled by assessing Veda credit applications, combined with National Vehicle Information System (NVIS)**figures from the last three years.
-Ends-
Source: Equifax Auto Analysis 2009-10
The www.vedaauto.com credit index was completed using August 2006 as the starting reference month. Commentary may be provided by referencing depersonalised data cubes for year-on-year analysis (YOY). Data analysed is drawn by referencing anonymised credit enquiry data from the Veda Advantage Consumer Credit Reporting Database. The Database includes application data from all significant lenders in Australia and distinguishes between personal and business applications for credit. The Database records relevant to this study are: gender of credit applicant, age of credit applicant, residential address of applicant (Post Code), amount of credit application.Demand indices reflect credit enquiries and not approved credit applications. Data is referenced and checked against Federal Chamber of Automated Industries (FCAI) public VFacts data to determine credit demand correlation to new vehicle total sales. The vedaauto.com Used Car Indicator is a unique data set, new to the Australian market, and tracks significant trends around credit demand for used vehicles over the calendar year.
Media Information:
Kevin Burke (02) 9492 1042 or mobile: 0415 945 869 email: Kevin@launchgroup.com.au
Sally Robertson (02) 9492 1089 or mobile: 0400 927 003 email: Sally@launchgroup.com.au
About Equifax Auto www.vedaauto.com. Twitter page:  http://twitter.com/VedaAuto. Equifax Auto is a business division of Veda Advantage Information Services and Solutions Limited ABN 26 000 602 862. Equifax Auto delivers vehicle information solutions to motor dealers, insurance firms, finance companies and consumers. Equifax Auto aims to help reduce fraud and improve transparency in the sale and purchase of second hand vehicles in Australia, to the benefit of both businesses and consumers alike. Equifax Auto sources data from the National Vehicle Information System (NVIS) and Government databases to compile the most comprehensive report possible (as based on available datasets) on the history of a motor vehicle.
*The National Vehicle Information System (NVIS) holds information on millions of vehicles that have been registered in Australia. It is the only comprehensive vehicle history database in operation in Australia. The NVIS is maintained and operated by Veda Advantage Ltd, the owner of Australia's leading consumer and commercial credit information bureau.
About Veda Advantage www.vedaadvantage.com. Veda Advantage has been at the forefront of the information services industry for many decades. Issues such as privacy, data security, fraud and business intelligence are part of our commercial landscape. Veda Advantage holds the country's largest database of credit files for more than 16.5 million credit-active Australians. The vast majority of applications for credit in Australia are checked against the files held by Veda Advantage - providing businesses with the information and knowledge to assist them in making informed decision in customer acquisition and credit risk management.
DISCLAIMER
Purpose of Veda Advantage media releases:
The information in this release is not intended to provide guidance or commentary as to Veda Advantage's financial position nor does it constitute legal, accounting or other professional financial advice. The information may change (based on the datasets available) and Veda Advantage does not guarantee the currency or accuracy of its sourced data. To the extent permitted by law, Veda Advantage specifically excludes all liability or responsibility for any loss or damage arising out of reliance on information in this release and the data in this report, including any consequential or indirect loss, loss of profit, loss of revenue or loss of business opportunity.