Nov 20 - Still-strong wholesale vehicle values resulted in
yet another decline for U.S. auto ABS losses, according to the latest index
results from Fitch Ratings.
October auto ABS losses also remained stable as the new model season kicked into
gear for vehicle sales.
The Manheim Used Value Index gained 1% increasing to 121.9 in October, up from
120.7 in September. Used vehicle inventories have remained tight for the past
year and a half, post-recession, challenged to meet demand and thus driving up
Prime cumulative net losses (CNL) continued to drop through October recording
the lowest level to date at 0.30%, a 6% improvement month-over-month (MOM) from
September. This is a 50% decline year-over-year (YOY), as borrower credit
quality of newer ABS has improved through the year.
60+ day delinquencies also dropped for prime auto loans (0.37% for October).
This is a 23% improvement YOY, and a 5% drop MOM. Prime sector delinquencies
have stabilized since second half-2012 (2H'12) with the U.S. economy showing
gradual (albeit protracted) improvement.
Subprime delinquencies have also remained stable through 2H'12, with negligible
movement in levels since June. 60+ day subprime delinquencies came in 3.73% in
October, a 7% increase MOM and 20% increase YOY.
October annualized net losses (ANL) improved YOY for both prime and subprime
sectors, while losses ticked up MOM. Prime ANL rose to 0.34%, 40% improved YOY
but up 21% MOM, while subprime ANL improved 7% YOY, yet increased 14% MOM.
Fitch's auto ABS indices comprise of $62.36 billion of outstanding notes issued
from 118 transactions. Of this amount, 76% comprise prime auto loan ABS and the
remaining 24% subprime ABS.
Fitch's outlook for prime auto ABS asset performance heading into 2013 is
stable, while ratings performance outlook is positive for prime auto ABS.