My Predictions about the Auto Industry
Since mortgage loans have dried up as housing values have dropped, another future problem is starting to show its ugly head...car loans.
In 1990 car loans were averaging 3 or 4 years in length. But it looks like they're now averaging 6 years. What observations can be drawn from this little statistic?
1. Much more interest expense will be paid and people will keep their cars longer
2. This will lead to more auto repairs and a greater need for the used car market.
3. New car sales will go down, and I predict not come up again for at least 5 years.
The end result? I expect GM, Ford, and Chrysler to go out of business, which will have a domino effect on all of us.
See what three little more years on the life of a loan can do to the economy?