The Industry

According to CNW Marketing Reaserch, independent dealers nationwide sold 14.2 million vehicles in 2007. The average vehicle price
decreased again from $8,492 in 2006 to $8,281. New and used vehicle sales were also down from 59.11 million in 2006 to 57.8
million vehicle in 2007.
The number of independent dealers saw a decrease as well in 2007 to 42,791 from 44,321 in 2006

• There were over 15,000 BHPH Dealers in 2006
• 1.1 million used car are re-possessed at an annual cost of over $300 million (avg $272/Vehicle)
• 8% of all repos traditionally occur within 12 months of the life of BHPH originations. Repos usually peak during the 3rd 90-day period of the contract.

(Source: JP Morgan Chase/Intex & Manheim News)

Independent Car Dealers Market Challenges:

• Access to Capital - availability of credit drives the used car market
• Higher level of default, 20% bad debts in 2006
• Consumer liquidity is lowering
• Over 50% of all BHPH contracts don’t pay out!
• BHPH is a collection business; risk management is key