Dealertrack Technologies' Michael Collins told SubPrime Auto Finance News during last month’s Vehicle Finance Conference hosted by the American Financial Services Association that the industry is in “very good shape.”

January’s used-vehicle sales performance — especially in the subprime and deep subprime spaces — reinforced Collins’ assessment.

CNW Research shared late on Super Bowl Sunday that the number of subprime used-vehicle buyers rose 14.38 percent in January versus a year ago. Potentially fueled by tax refund cash, CNW noticed a 3.9-percent increase in sales at buy-here, pay-here dealerships.

CNW also reported that buyers with FICO scores below 550 increased 7.8 percent in January and represented nearly 22 percent of total used-car sales for the month.

In total, CNW indicated used-car sales in January — a combination of turns at franchised and independent stores as well private party transactions — came in at 2.38 million, up 2 percent versus the same month a year earlier.

“Availability of credit is very strong. We saw it in all (of 2014) through the credit application network across the U.S.,” Collins said when the industry still had about a week left in the sales month. “It’s at better levels than almost pre-recession. We’re very excited about that.”

Jonathan Dodds, chief executive officer for the Americas at White Clarke Group, acknowledged that 2014 was “a big growth year in subprime, and I don’t really see that slowing down.”

Dodds explained why he doesn’t believe subprime financing isn’t going to slacken anytime soon, referencing the industry evolution in the past five years.

“Especially in the subprime space, the consumer didn’t have a whole heap of choice. That’s changing,” Dodds said during a conversation at AFSA’s event. “It is more commodity based at the moment. You may get offers from three or four different lenders, especially if they go the route of a solution like Dealertrack.

“Now lenders are looking at more services they can provide dealerships and the end consumer to make themselves stand out, like AAA where there are some additional value adds in there, beyond just the pure financing model,” he continued.

“They’re asking themselves how can I at least retain market share or even increase it other than just the price basis,” Dodds added.

CNW determined that more than 200,000 used-car buyers secured pre-approved financing in January compared to 175,800 a year ago, resulting in a gain of more than 14 percent. CNW calculated that pre-approval figure resulted in 8.42 percent of January used sales being booked through that method.

And Dodds mentioned that if potential purchasers didn’t already have their financing arranged, they likely aren’t apt to be patient at the dealership long waiting for the underwriting to be completed.

“Subprime is traditionally slower than prime. In subprime, people used to boast that they would get back to their dealers in 30 minutes. Now our clients are wanting to get back to dealers in less than 30 seconds in order to get that deal,” Dodds said. “People want to go now in that shiny vehicle. They’re not going to sit around waiting.”

Perhaps consumers don’t want to wait at the dealership to finalize financing because they don’t want to be at the store at all. What CNW president Art Spinella described as “not surprising,” fewer people visited dealership used-car lots in January than in December — off nearly 30 percent and following historic December-January trends.

“Consumers continue shopping outside of their local markets in growing numbers, hunting the best deals and specific vehicles, using the Internet to find a specific car or truck,” Spinella said. “The number of bought outside their local market rose by more than 12 percent versus a year ago.”

Finally, Dodds touched on other development associated with potential subprime vehicle buyers.

“The new generation of subprime aren’t necessarily the ones who have lost their jobs or been divorced,” Dodds said. “They’re 25 to 35 and living at home and don’t have credit cards, vehicle loans or a mortgage. They don’t have a credit footprint. The challenge is how do finance companies get into that demographic.”