Banks will repossess vehicles to try and minimise losses
Banks will not be able to sell those repossessed vehicles, resulting in losses
Banks may become insolvent as they are unable to liquidate the vehicles
Government steps in to bail them out
New vehicle prices are not in line with their actual value, so banks are making loans that aren’t covered by the collateral. This is shit management by the banking industry. If it’s impossible to get an auto loan then vehicle prices will eventually fall as supply stacks up. Banks are feeding this cycle by being unrealistic in these loan assessments.