As more consumers debate how safe it is to add another loan to their debts, the motor loan industry is beginning to feel the pinch. New car sales are down and the rates of applications for new motor loans have fallen sharply. Many believe that until the housing crisis ends, the motor loan industry is in for a very long fight.”People are conscious about where their costs are,” said Marc Cannon of AutoNation, the nation’s largest auto retailer. “People had less income because they were paying more on their homes,” he said. “Interest rates have come down, but at the same time the economy has become shaky because their home (values) have come down, so they’ve got less equity in their homes. And then you put on top of that the whole issue of the cost of food and other things, and now with gas at $3.50 and approaching $4, now people say to themselves ‘Hey, I don’t want to overcommit myself.’”"You obviously see more SUVs being traded in,” he added. “People are clearly moving to cross-over vehicles … to value-priced cars, cars that are serving their needs, but are putting less burden on their monthly income. Customers are clearly looking at the price of a vehicle more than they ever have before.”
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