New York, NY (PRWEB) June 09, 2014
Operators in the Repossession Services industry repossess properties including automobiles, boats, furnishings and equipment on behalf of creditors when individuals fail to keep up with their loan payments. At the height of the recession, an increase in loan defaults and delinquencies caused repossession rates to soar as creditors sought to collect loan collateral. As a result, industry revenue increased, peaking in 2009. However, during subsequent years, the number of consumers defaulting on their loans bottomed out, with the risk composition on debt holders improving amid deleveraging. Consequently, demand for industry services collapsed as repossession rates fell. Therefore, in the five years to 2014, industry revenue is expected to decline at an annualized rate.
In more recent years, the industry has slowly begun to recover from its postrecessionary trough. While improving economic conditions initially reduced the number of repossessions, thereby hurting demand for industry services, the strengthening economy has started to boost demand. As disposable income levels have risen, consumers have begun to increase their purchases, while creditors have expanded financing. As a result, loan volumes have increased and the overall number of delinquencies has climbed, though the share of delinquent loans has contracted. Consequently, according to IBISWorld Industry Analyst Maksim Soshkin, “repossession rates have increased and demand for industry services has risen.” In particular, “the recent surge in subprime auto loans (loans to borrowers with low credit scores) has resulted in more car repossessions, which is the industry's primary source of revenue,” says Soshkin. Therefore, industry revenue is estimated to increase in 2014.
The Repossession Services industry exhibits low market share concentration. Over the five years to 2019, industry revenue is forecast to increase. Increasing per capital disposable income levels and declining unemployment will result in more consumer spending. Many consumers will likely opt to finance their purchases, and creditors are anticipated to make loans more accessible. Specifically, auto manufacturers are expected to increase subprime financing for borrowers. The resulting increase in the number of loans will lead to higher number of delinquencies, resulting in increased demand for industry services. However, rising interest rates and cautious consumers will temper loan volume growth.
For more information, visit IBISWorld’s Repossession Services in the US industry report page.
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IBISWorld industry Report Key Topics
The Repossession Services industry reposes tangible assets (e.g. automobiles, boats, equipment, planes, furniture and appliances) for a creditor as a result of delinquent debt by an individual.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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