Ford Motor Company (F), Nissan Motor Co., Ltd. (ADR) (NSANY): These Cars Are Big With Subprime Buyers

Like most automakers, Ford Motor Company (NYSE:F) has an in-house financing arm, Ford Credit. And like most automakers’ finance companies, Ford Credit does make loans to subprime buyers. But Ford Credit is quite conservative, generally speaking, and officials said late last year that their “high risk” loans were in the 5% to 6% range — in line with the industry average, and not a cause for concern.

The story is a little different with Chrysler, though. Chrysler doesn’t have an in-house financing arm, for one thing. And for another, it has always had a reputation for being a little more willing than most to find deals for customers with damaged credit.

Chrysler and Kia top the subprime list
Chrysler’s reputation has some data to support it: Data from credit agency Experian last year showed that in the first quarter of 2012, 29% of Chrysler’s customers had credit scores below 680, which Experian considers subprime.

That was good enough for second place among the automakers doing business in the United States.

Care to guess who was in first? If you guessed corporate cousins Hyundai and Kia, who together have 31%, you got it.

Now, if I tell you that Chrysler’s U.S. sales were up 21% last year, does that suggest anything? Or that Kia had a streak of 27 straight months of U.S. sales growth that ended only last December?

I don’t know if it does. But the economic downturn left a lot of Americans with dents in their credit ratings. It might well be that these companies are more willing to reach out to these folks than others are– and that might turn out to be a sales advantage nowadays.

The article These Cars Are Big With Subprime Buyers originally appeared on Fool.com and is written by John Rosevear.

Fool contributor John Rosevear owns shares of Ford. Follow him on Twitter at @jrosevear.The Motley Fool recommends and owns shares of Ford.

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