McLEAN, Va. — On Wednesday, the National Auto Dealers Association addressed the challenge dealers are facing in getting auto loan applications approved.

The association indicated that industry experts agree that the economics of auto financing are sound and that vehicle financing did not cause the current crisis.

"America's financial liquidity crisis, created by mortgage lending, is constraining the availability of auto credit, which is the lifeblood of both dealerships at the wholesale level and car buyers at the retail level," said Annette Sykora, NADA chairman. 

"Nonetheless, banks and finance companies are reluctant to lend. Consumers — even those with good credit — are finding it increasingly difficult to get financing. To address the issue, NADA is moving forward on several fronts," she pointed out.

First, the NADA is meeting with the major associations representing the banking and financial services industries. The purpose of these meetings are to emphasize the fundamental soundness of the existing auto finance model; and to highlight the fact that it is, therefore, in the economic interests of finance sources to continue making credit available for automotive retailing.

In addition, NADA said it is supporting Congressional efforts both to stabilize liquidity in the economy and to provide government funding that would make available $25 billion in loans for the auto industry.

"Our message to the financial community and Congress is simple: Auto financing is sound. We just need liquidity to do our jobs," Sykora concluded.