Car Repossessions Climb Back to Levels Seen During the Great Recession, with 1.7 Million Vehicles Reclaimed | Carscoops

      Consumers are defaulting on car loans at an alarming rate, with defaults surpassing 2.3 million.

      Approximately 2,332,837 auto loan defaults occurred last year, exceeding the levels observed during the Great Recession.

      Around 1.73 million vehicles were repossessed, marking the highest figure in over ten years.

      Sales in March are anticipated to decrease slightly from last year, but the outlook is grim due to tariffs.

      Economists have expressed concerns about an impending recession for years, and it now seems inevitable due to a combination of job cuts, tariffs, and uncertainty. Warning signs are prevalent, as consumer confidence recently fell to a 12-year low.

      Another warning signal has emerged as Cox Automotive has quietly noted that the “repossession rate has returned to 2019 levels, while auto loan defaults have risen.” Analyzing the figures, the number of car loan defaults last year was 2,332,837, a staggering count that surpassed those during the height of the Great Recession.

      The default rate for last year was 3.13%, the highest since 2011. This trend began during the Great Recession when the default rate was 3.18% in 2007, rising to 3.76% in 2008, and peaking at 4.12% the following year before gradually decreasing to the 2% range.

      Since repossessions and defaults are closely linked, it’s not surprising that there was an increase in repossessions last year. An estimated 1.73 million vehicles were reclaimed in 2024, reaching the highest level since 2009. The repossession rate of 2.3% also rose to levels not seen in years.

      Despite these concerning developments, Cox indicated that March sales are not expected to be significantly affected by the threat of tariffs or economic uncertainty. Nevertheless, a 1.4% decline is still anticipated compared to the previous year.

      The future remains unclear, as Cox stated, “Tariffs imposed across North America as proposed – depending on their duration – could disrupt both the U.S. auto market and the broader economy.”