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Jamie Dimon: “Someone will get hurt in auto lending.” Photo credit: Bloomberg
NEW YORK — JPMorgan Chase & Co. CEO Jamie Dimon said the market for U.S. automobile lending is “a little stressed” and that he foresees higher losses ahead for some competitors.
“Someone will get hurt in auto lending,” but not JPMorgan, Dimon said today during an investor presentation in New York.
That pain could be compounded by weakening U.S. auto sales, which fell in May for the second monthly decline this year and reinforced the idea that demand for cars and trucks has plateaued. The results for last month, whose Memorial Day weekend promotions make it a bellwether for gauging buyer appetite, show consumer demand for cars leveling off faster than executives predicted.
U.S. Bancorp CEO Richard Davis, speaking at the same conference earlier in the day, said the auto-lending market is “overheated,” mainly because of pricing competition.
“We like the business, but it’s not for the faint of heart,” said Davis, who runs the nation’s biggest regional bank. “It’s a business you have to watch through the cycles, and right now it is probably at its least attractive. But in what could be a day, a month or a year, it could be very attractive.”
Auto lending market 'a little stressed,' JPMorgan Chase CEO Dimon says
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