Retail

End of the 'free lunch on interest rates'

Will the holiday atmosphere for car sales continue into 2016? Higher interest rates are likely to force automakers and their captive finance arms to dial up incentives to avoid passing higher costs on to consumers. (David Phillips)
December 20, 2015 05:00 AM
None
Captive audience
Subvented loans and leases supported by automakers have helped drive sales this year. Here are 0% loans as a share of new-vehicle purchases.
 0% loans
20119.20%
20129.10%
20139.40%
20148.70%
2015*9.90%
*Through November
Source: Edmunds.coms

The Federal Reserve's interest-rate increase last week and its new long-term course toward further tightening probably won't slow consumer demand for new and used vehicles.

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