Electric and Hybrid Vehicle Financing Grows In Q4 2020

Published: March 4, 2021 by Melinda Zabritski

Alternative fuel vehicles aren’t a new concept, but they have certainly been gaining momentum in recent years, as manufacturers introduce new models and costs decrease.

What are the finance implications of the shifting marketplace for alternative fuels? In the Q4 2020 State of the Automotive Finance Market report, we zoomed in on the alternative fuel financing to get a better picture. Here are some of the trends we found.

Electric and hybrid vehicle financing is growing

Both electric and hybrid vehicles are growing their share of the finance market. In Q4 2016, electric and hybrid vehicles made up 2.99% of vehicle financing. It has more than doubled since then, making up 6.72% in Q4 2020.

Average monthly payments run higher for alternative fuel

For consumers looking for a new electric vehicle, they’ll likely be looking at a larger average monthly payment. In Q4 2020, the average monthly payment for an electric vehicle was $689.

Hybrid vehicles saw average monthly payments that aligned closer to those of gasoline vehicles. The average monthly payment for a gasoline vehicle in Q4 2020 was $524, and the average monthly payment for a hybrid vehicle was just $5 more, at $529.

Electric vehicles have the highest average credit scores for financing

Similar to what we’ve seen with average credit scores for new car loans, the average scores for new alternative fuel vehicles have mostly seen steady increases in the last few years. As of Q4 2020, the highest is for electric vehicles, at 763, followed by hybrid (756), and gasoline/flex (731).

Toyota and Tesla are the most popular make and model

When looking at electric and hybrids, Toyota has the greatest market share at 38.5%, followed by Tesla at 25.82%. The most popular makes also go to these two brands: The Tesla Model Y was the most popular in Q4 2020 at 13.3%, followed by the Toyota RAV4 at 11.19%. Here’s how the top 5 round out for each category:

As manufacturers continue to introduce new electric and hybrid models, it is likely that the alternative fuel market will continue to grow in finance market share. By staying close to the data, lenders and dealers can make the most strategic decisions to navigate the ever-changing market in the years to come.

Learn more by watching Experian’s full Q4 2020 State of the Automotive Finance Market report

Why More Borrowers Are Refinancing Their Vehicles, and...

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In an ever-evolving automotive landscape, where shifting consumer behavior meets fluctuating market dynamics, Experian’s State of the Automotive Finance Market Report: Q2 2025 delivers key insights into how both consumers and professionals are adapting to the changes. This quarter’s report revealed a sharp increase in vehicle refinancing—up nearly 70% from Q2 2024—as consumers capitalized on the more stable rate environment. In fact, after refinancing, the average interest rate went from 10.45% to 8.45%. That shift resulted in their monthly payment dropping by an average of $71. Interestingly, credit unions played a significant role in the refinance surge, increasing their market share from 63.22% last year to 68.33% this quarter, and borrowers who refinanced through credit unions saw their monthly payments decrease by $87 on average. Banks saw a slight dip in their share of the refinancing market year-over-year, going from 22.71% to 21.45%, and borrowers who refinanced through them saved an average of $46 a month. New leaders emerge as the lender market share continues to evolve Taking a deeper dive into the automotive finance market share, banks reclaimed their leading position for total vehicle financing, rising to 27.50% in Q2 2025, from 24.50% in Q2 2024. Meanwhile, captives declined from 30.17% to 26.63% year-over-year, and credit unions slightly increased from 20.35% to 21.04% during the same period. For new vehicles, captives continued to lead at 52.39% this quarter, though it was a drop from 60.74% last year. On the other hand, banks grew from 21.12% to 25.91% and credit unions went from 9.99% to 12.24% in the same time frame. On the used side, banks edged ahead, increasing their share to 28.59% in Q2 2025, from 26.80% last year. Credit unions saw slight growth from 27.59% to 27.63%, while captives declined from 7.83% to 6.40% year-over-year. As affordability remains a key priority, consumers seem to be exploring financing options that offer more favorable terms. While Experian Automotive’s report continues to illustrate the evolving dynamics, these data-driven insights can empower both consumers and industry professionals to make smarter financial decisions. To learn more about automotive finance trends, view the full State of the Automotive Finance Market Report: Q2 2025 presentation on demand.

Published: September 5, 2025 by Melinda Zabritski