Japan’s automakers have begun hiking loan rates as a historic central bank pivot to unwind three decades of ultraloose monetary policy trickles down to consumers, raising household credit costs.
More than a year after the Bank of Japan’s first interest rate increase in 17 years, the volatile march higher in superlong bonds is raising the cost of servicing loans, including car repayments — making the auto sector one of the first key pain points as households look to tighten their belts.
Japan’s biggest carmakers are already raising rates. Honda’s annual interest rate has been at 5.5% since April, according to the company’s website, a bump from the 4.9% it offered in June 2024. Mazda said it currently offers a 3.9% annual interest rate for residual credit loans, an increase from last year’s 3.4%, through its joint venture with Toyota Finance.
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