Credit crunch pressuring car sales: AutoNation
DETROIT (Reuters) - The U.S. credit crunch is hammering even prime borrowers looking to buy cars and trucks in the United States, the chief executive of top U.S. auto dealership group AutoNation Inc (AN.N) said on Tuesday.
Sales volumes have been pressured by up to 20 percent by the lack of available credit, a situation that has forced layoffs at automakers, parts suppliers and retailers and slowed the U.S. economy, Mike Jackson said in an appearance on CNBC.
"The banks are looking for every excuse possible to say no and they are saying no to good customers. They are saying no to customers with good credit and it's having a significant impact on volume in the automobile industry," Jackson said.
AutoNation has seen car loan approval rates for people with good credit decline to about 60 percent now from roughly 90 percent a year ago. About 10 percent of subprime customers can get loans now, down from 50 percent a year ago.
Jackson said the credit market tightness made it critical for Congress to complete the U.S. financial sector bailout, which he said would support customers more than Wall Street bankers, despite public perceptions.
"Life is going to be miserable on main street if this package is not approved," Jackson said, describing the $700 billion program as an investment that could be recouped.
"I think it has been poorly sold, but at the end of the day, it has to be done or there will be massive pain on main street.".
(Reporting by David Bailey; Editing by Andre Grenon)
