<PAGE>   1
================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                -----------------

                                    FORM 10-Q

                                -----------------

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2001

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    FOR THE TRANSITION PERIOD FROM ______________ TO ______________

                          COMMISSION FILE NUMBER: 28050

                           ONYX ACCEPTANCE CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)


          DELAWARE                                               33-0577635
(STATE OR OTHER JURISDICTION OF                               (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION)                               IDENTIFICATION NO.)


                           ONYX ACCEPTANCE CORPORATION
                            27051 TOWNE CENTRE DRIVE
                            FOOTHILL RANCH, CA 92610
                                 (949) 465-3900
          (ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)

                                ----------------

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                                 YES [X] NO [ ]

     As of August 14, 2001, there were 5,071,413 shares of registrant's Common
Stock, par value $.01 per share outstanding.

================================================================================

<PAGE>   2

                           ONYX ACCEPTANCE CORPORATION

                     INDEX TO QUARTERLY REPORT ON FORM 10-Q


                                                                            PAGE
                                                                            ----
PART I.  Financial Information............................................    3

Item 1.  Financial Statements.............................................    3

         Condensed Consolidated Statements of Financial Condition
         at June 30, 2001 and December 31, 2000...........................    3

         Condensed Consolidated Statements of Income for the three
         and six months ended June 30, 2001 and June 30, 2000.............    4

         Consolidated Statement of Stockholders' Equity at June 30, 2001..    5

         Condensed Consolidated Statements of Cash Flows for the
         six months ended June 30, 2001 and June 30, 2000.................    6

         Notes to Condensed Consolidated Financial Statements.............    7

Item 2.  Management's Discussion and Analysis of Financial Condition
         and Results of Operations........................................   12

Item 3.  Quantitative and Qualitative Disclosures about Market Risk.......   18

PART II. Other Information................................................   18

Item 1.  Legal Proceedings................................................   18

Item 4.  Submission of Matters to a Vote of Security Holders..............   19

Item 5.  Other Information................................................   20

Item 6.  Exhibits and Reports on Form 8-K.................................   26

SIGNATURES................................................................   27

EXHIBIT INDEX.............................................................   28



                                       2
<PAGE>   3

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

            CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                   (UNAUDITED)

                                     ASSETS

<TABLE>
<CAPTION>
                                                            JUNE 30,    DECEMBER 31,
                                                              2001          2000
                                                            --------    ------------
                                                             (DOLLARS IN THOUSANDS)
<S>                                                         <C>           <C>
Cash and cash equivalents ...............................   $  6,024      $  3,130
Credit enhancement assets ...............................    169,973       146,013
Contracts held for sale (Net of allowance) ..............    166,960       170,755
Other assets ............................................     10,290        11,482
                                                            --------      --------
           Total assets .................................   $353,247      $331,380
                                                            ========      ========

                                  LIABILITIES

Accounts payable ........................................   $ 31,810      $ 22,706
Debt ....................................................    236,854       233,152
Other liabilities .......................................     24,652        19,929
                                                            --------      --------
          Total liabilities .............................    293,316       275,787

                                     EQUITY

Common stock
  Par value $.01 per share; authorized 15,000,000 shares;
    issued and outstanding 4,989,504 as of June 30, 2001
    and 4,989,504 as of December 31, 2000 ...............         50            50
Paid in capital .........................................     32,601        32,601
Retained earnings .......................................     24,259        21,550
Accumulated other comprehensive income, net of tax ......      3,021         1,392
                                                            --------      --------
           Total equity .................................     59,931        55,593
                                                            --------      --------
           Total liabilities and equity .................   $353,247      $331,380
                                                            ========      ========
</TABLE>


 See the accompanying notes to the condensed consolidated financial statements.

                                       3

<PAGE>   4

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                                THREE MONTHS ENDED            SIX MONTHS ENDED
                                                     JUNE 30,                     JUNE 30,
                                            -------------------------     -------------------------
                                               2001           2000           2001           2000
                                            ----------     ----------     ----------     ----------
                                               (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                                   (UNAUDITED)                   (UNAUDITED)
<S>                                         <C>            <C>            <C>            <C>
REVENUES:
Interest income .......................     $    8,831     $    4,438     $   15,606     $   13,336
Interest expense ......................          2,899          3,346          7,084          8,286
                                            ----------     ----------     ----------     ----------
Net interest income ...................          5,932          1,092          8,522          5,050
Gain on sale of contracts .............         10,257         13,989         19,576         26,745
Service fee income ....................         12,699         10,278         25,809         18,958
                                            ----------     ----------     ----------     ----------
Total Revenues ........................         28,888         25,359         53,907         50,753

EXPENSES:
    Provision for credit losses .......            130            285            464            718
    Interest expense-other ............          1,523          1,066          3,063          2,512

OPERATING EXPENSES:
    Salaries and benefits .............         14,160         12,568         26,667         24,071
    Systems and servicing .............          1,546          1,488          3,097          3,063
    Telephone and data lines ..........          1,329          1,508          2,479          3,155
    Depreciation ......................          1,220          1,019          2,474          2,021
    General and administrative expenses          5,862          4,751         11,032          9,679
                                            ----------     ----------     ----------     ----------
Total Operating Expenses ..............         24,117         21,334         45,749         41,989
                                            ----------     ----------     ----------     ----------
Total Expenses ........................         25,770         22,685         49,276         45,219
                                            ----------     ----------     ----------     ----------
    Income before Income Taxes ........          3,118          2,674          4,631          5,534
    Income Taxes ......................          1,294          1,109          1,922          2,297
                                            ----------     ----------     ----------     ----------
Net Income ............................     $    1,824     $    1,565     $    2,709     $    3,237
                                            ==========     ==========     ==========     ==========
Net Income per share -- Basic .........     $     0.37     $     0.26     $     0.54     $     0.53
Net Income per share -- Diluted .......     $     0.35     $     0.25     $     0.53     $     0.51
Basic Shares Outstanding ..............      4,989,504      6,072,656      4,989,504      6,126,289
Diluted Shares Outstanding ............      5,156,902      6,224,764      5,144,507      6,287,141
</TABLE>

 See the accompanying notes to the condensed consolidated financial statements.

                                       4

<PAGE>   5

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                            ACCUMULATED
                                                                  ADDITIONAL               COMPREHENSIVE
                                                        COMMON     PAID-IN     RETAINED     GAIN (LOSS),
                                             SHARES      STOCK     CAPITAL     EARNINGS      NET OF TAX       TOTAL
                                             ------     ------    ----------   ---------   -------------    ---------
<S>                                           <C>       <C>       <C>          <C>             <C>           <C>
BALANCE, DECEMBER 31, 2000.................   4,990     $  50     $  32,601    $  21,550       $ 1,392       $55,593
Comprehensive income:
Unrealized gains in securitized
  assets, net of tax of $1.1 million.......                                                      1,629         1,629
Adoption of FAS 133, net of
  tax of ($596) thousand...................                                                       (840)         (840)
Loss on derivatives reclassified to
  earnings net of tax of $596 thousand.....                                                        840           840
Net income.................................                                        2,709                       2,709
                                              -----     -----     ---------    ---------       -------       -------
Total comprehensive income.................                                        2,709         1,629         4,338
                                              -----     -----     ---------    ---------       -------       -------
BALANCE, JUNE 30, 2001.....................   4,990     $  50     $  32,601    $  24,259       $ 3,021       $59,931
                                              =====     =====     =========    =========       =======       =======
</TABLE>


 See the accompanying notes to the condensed consolidated financial statements.

                                       5

<PAGE>   6

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                            SIX MONTHS ENDED
                                                               JUNE 30,
                                                        ------------------------
                                                          2001           2000
                                                        ---------      ---------
                                                         (DOLLARS IN THOUSANDS)
                                                              (UNAUDITED)
<S>                                                     <C>            <C>
OPERATING ACTIVITIES:
  Net cash provided by operating  activities ......     $     417      $  25,824

INVESTING ACTIVITIES:
  Purchases of property and equipment .............        (1,477)        (2,716)

FINANCING ACTIVITIES:
  Proceeds from exercise of employee options ......            --              6
  Repurchase of common stock ......................            --         (4,142)
  Proceeds (payments) on capital lease obligations            251           (116)
  Payments on residual lines of credit ............       (13,884)       (46,054)
  Proceeds from drawdown on residual
    lines of credit ...............................        26,100         19,000
  Paydown of warehouse lines related to
    Securitizations ...............................      (660,310)      (746,489)
  Proceeds from warehouse lines ...................       653,398        750,215
  Proceeds from issuance of subordinated debt .....            --         11,518
  Principal payments on subordinated debt .........        (1,601)          (973)
  Payments on other loans .........................            --           (199)
                                                        ---------      ---------
Net cash (used in) provided by financing activities         3,954        (17,234)
                                                        ---------      ---------
  Increase in cash and cash equivalents ...........         2,894          5,874

Cash and cash equivalents at beginning of period ..         3,130          5,190
                                                        ---------      ---------
Cash and cash equivalents at end of period ........     $   6,024      $  11,064
                                                        =========      =========
</TABLE>


 See the accompanying notes to the condensed consolidated financial statements.

                                       6

<PAGE>   7

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                   (UNAUDITED)

NOTE 1 -- BASIS OF PRESENTATION

     The condensed consolidated financial statements included herein are
unaudited and have been prepared by Onyx Acceptance Corporation ("Onyx" or the
"Company") in accordance with generally accepted accounting principles for
interim financial reporting and Securities and Exchange Commission regulations.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to the regulations. In the opinion of
management, the financial statements reflect all adjustments (of a normal and
recurring nature), which are necessary to present fairly the financial position,
results of operations and cash flows for the interim period. Operating results
for the three and six months ended June 30, 2001 are not necessarily indicative
of the results that may be expected for the year ending December 31, 2001. The
condensed consolidated financial statements should be read in conjunction with
the audited financial statements and footnotes thereto for the year ended
December 31, 2000 included in the Company's 2000 Annual Report on Form 10-K.

     USE OF ESTIMATES

     In conformity with generally accepted accounting principles, management
utilizes assumptions and estimates that affect the reported values of assets and
liabilities and disclosures of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses for
each reporting period. The more significant estimates made in the preparation of
the Company's condensed consolidated financial statements relate to the credit
enhancement assets and the gain on sale of motor vehicle retail installment
sales and loan contracts ("Contracts"). Such assumptions include, but are not
limited to, estimates of loan prepayments, defaults, recovery rates and present
value discount rates. The Company uses a combination of its own historical
experience and expectation of future performance to determine such estimates.
Actual results may differ from the Company's estimates due to numerous factors
both within and beyond the control of Company management. Changes in these
factors could require the Company to revise its assumptions concerning the
amount of voluntary prepayments, the frequency and/or severity of defaults and
the recovery rates associated with the disposition of repossessed vehicles.

     RECLASSIFICATION

     Certain amounts in the prior quarter and year to date condensed
consolidated financial statements have been reclassified to conform to the
corresponding 2001 presentation.

NOTE 2 -- CONTRACTS HELD FOR SALE

     Contracts held for sale consisted of the following:

                                           JUNE 30,        DECEMBER 31,
                                             2001              2000
                                          ---------        ------------
                                                (IN THOUSANDS)
     Gross contracts held for sale        $ 172,385         $ 177,086
     Less unearned interest ......           (2,112)           (3,302)
                                          ---------         ---------
     Contracts held for sale .....          170,273           173,784
     Allowance for credit losses .           (1,155)           (1,175)
     Dealer participation ........           (2,158)           (1,854)
                                          ---------         ---------
     Total .......................        $ 166,960         $ 170,755
                                          =========         =========


                                       7


<PAGE>   8

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                                   (UNAUDITED)


NOTE 3 -- CREDIT ENHANCEMENT ASSETS

     Credit enhancement assets consisted of the following:

                                   JUNE 30,      DECEMBER 31,
                                     2001           2000
                                   --------      ------------
                                        (IN THOUSANDS)
     Trust receivable......        $  7,745        $  7,510
     RISA .................         162,228         138,503
                                   --------        --------
     Total ................        $169,973        $146,013
                                   ========        ========

     Retained interest in securitized assets ("RISA") capitalized upon
securitization of Contracts represent the present value of the estimated future
earnings to be received by the Company from the excess spread created in
securitization transactions. Excess spread is calculated by taking the
difference between the coupon rate of the Contracts sold and the weighted
average security rate paid to the investors less contractually specified
servicing and guarantor fees and projected credit losses, after giving effect to
estimated prepayments.

     Prepayment and credit loss assumptions are utilized to project future
earnings and are based on historical experience. Credit losses are estimated
using cumulative loss frequency and severity estimates by management. All
assumptions are evaluated each quarter and adjusted, if appropriate, to reflect
the actual performance of the underlying Contracts. Future earnings are
discounted at a rate management believes to be representative of market at the
time of securitization.

     During 1999, the Emerging Issues Task Force ("EITF") issued EITF 99-20,
Recognition of Interest Income and Impairment on Purchased and Retained
Beneficial Interests in Securitized Financial Assets. EITF 99-20 establishes new
income and impairment recognition standards for interests in certain securitized
assets. Under the provisions of EITF 99-20, the holder of beneficial interests
should recognize the excess of all estimated cash flows attributable to the
beneficial interest estimated at the acquisition date over the initial
investment (the accretable yield) as interest income over the life of the
beneficial interest using the effective yield method. If the estimated cash
flows change, then the holder of the beneficial interest should recalculate the
accretable yield and adjust the periodic accretion recognized as income
prospectively. If the fair value of a beneficial interest has declined below its
carrying amount, an other-than-temporary decline is considered to exist if there
has been a decline in estimated future cash flows and the difference between the
carrying value and fair value of the beneficial interest is recorded as an
impairment loss through the income statement.

     Effective April 1, 2001, the Company adopted EITF 99-20. Prior to the
adoption of EITF 99-20, the balance of RISA was amortized against actual excess
spread income earned on a monthly basis over the expected repayment life of the
underlying Contracts. The adoption of EITF 99-20 resulted in amounts previously
recognized as service fee income being recognized as interest income.

     The following table presents the balances and activity for RISA:

                                            JUNE 30,        DECEMBER 31,
                                              2001              2000
                                            ---------       ------------
                                                  (IN THOUSANDS)
     Beginning Balance .............        $ 138,503         $ 137,171
     Additions .....................           42,314           109,173
     Amortization ..................          (21,347)          (61,229)
     Sale of RISA ..................                            (49,924)
     Change in unrealized gain on
       Securities available for sale            2,758             3,312
                                            ---------         ---------
     Ending Balance ................        $ 162,228         $ 138,503
                                            =========         =========


                                      8

<PAGE>   9

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                                   (UNAUDITED)


     In initially valuing the RISA, the Company establishes an off balance sheet
allowance for probable future credit losses. The allowance is based upon
historical experience and management's estimate of other factors that may affect
portfolio performance. The amount is reviewed periodically and adjustments are
made if actual experience or other factors indicate that future performance may
differ from management's prior estimates.

     The following table presents the estimated future undiscounted retained
interest earnings to be received from securitizations. Estimated future
undiscounted RISA earnings are calculated by taking the difference between the
weighted average annual percentage rate of the Contracts sold and the weighted
average security rate paid to the investors, less the contractually specified
servicing fee of 1.0% and financial insurance fees, after giving effect to
estimated prepayments and assuming no losses. To arrive at the RISA, this amount
is reduced by the off balance sheet allowance established for probable future
losses and by discounting to present value at the current market discount rates.

                                                  MARCH 31,      DECEMBER 31,
                                                    2001             2000
                                                 -----------     -----------
                                                         (IN THOUSANDS)
     Estimated net undiscounted RISA earnings..  $   310,100     $   286,125
     Off balance sheet allowance for losses ...     (116,478)       (116,086)
     Discount to present value ................      (31,394)        (31,536)
                                                 -----------     -----------
     Retained interest in securitized assets...  $   162,228     $   138,503
                                                 ===========     ===========
     Outstanding balance of contracts sold
       through Securitizations ................  $ 2,634,679     $ 2,513,407

NOTE 4 -- NET INCOME PER SHARE

     The following table sets forth the computation of basic and diluted net
income per share ("EPS"):

<TABLE>
<CAPTION>
                                                    THREE MONTHS ENDED      SIX MONTHS ENDED
                                                         JUNE 30,              JUNE 30,
                                                    ------------------     -----------------
                                                      2001       2000       2001       2000
                                                    -------     ------     ------     ------
                                                       (IN THOUSANDS, EXCEPT $ PER SHARE)
<S>                                                  <C>        <C>        <C>        <C>
     Net Income ................................     $1,824     $1,565     $2,709     $3,237
                                                     ======     ======     ======     ======
     Weighted average shares outstanding .......      4,990      6,073      4,990      6,126
     Net effect of dilutive stock
       options/warrants ........................        167        152        155        161
                                                     ------     ------     ------     ------
     Diluted weighted average shares outstanding      5,157      6,225      5,145      6,287
                                                     ======     ======     ======     ======
     Net income per share:
     Basic EPS .................................     $ 0.37     $ 0.26     $ 0.54     $ 0.53
                                                     ======     ======     ======     ======
     Diluted EPS ...............................     $ 0.35     $ 0.25     $ 0.53     $ 0.51
                                                     ======     ======     ======     ======
</TABLE>

NOTE 5 -- CHANGE IN ACCOUNTING PRINCIPLES

     ADOPTION OF SFAS NO. 133

     Effective January 1, 2001 Onyx adopted the provisions of Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities" ("SFAS No. 133"), as amended. SFAS No. 133 requires
companies to record derivatives on the balance sheet as assets and liabilities,
measured at fair value. The accounting for the gain or loss due to changes in
fair value of the derivative instrument depends on whether the derivative
qualifies as a hedge. If the derivative instrument does not qualify as a hedge,
the gains or losses are reported in earnings when they occur. If the derivative
instrument qualifies as a hedge, the accounting varies based upon the type of
risk being hedged.


                                       9

<PAGE>   10

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                                   (UNAUDITED)


     Adopting the provisions of SFAS No. 133 on January 1, 2001 resulted in a
one-time cumulative after-tax reduction in Accumulated Other Comprehensive
Income as of January 1, 2001, of $840,000, representing the fair value of the
derivatives net of tax.

     All components of each derivative's gain or loss were included in the
assessment of hedge effectiveness. The Company has reclassified to earnings
$840,000 of its loss from adoption, which was recorded in Accumulated Other
Comprehensive Income when the forecasted transaction occurred during the first
quarter of 2001.

     Cash Flow Hedges

     Onyx maintains an overall risk management strategy that incorporates the
use of interest rate and derivative financial instruments to mitigate its
exposure to significant unplanned fluctuations in earnings caused by volatility
in interest rates. Derivative instruments that are used as part of the Company's
interest rate management strategy include forward interest rate swaps. These
instruments are designated as cash flow hedges. Onyx does not use any of these
instruments for trading or speculative purposes.

     The Company uses forward interest rate swaps to hedge the variability in
the forecasted future net cash flows it will receive from the RISA attributable
to the risk of changing interest rates. The Company's interest rate swap
agreements involve arrangements to pay a fixed interest rate and receive a
floating interest rate, at specified intervals, calculated on agreed-upon
amortizing notional amounts. The debt and amounts that the Company hedges are
determined based on prevailing market conditions and the current shape of the
yield curve. Interest rate swap agreements are executed as an integral part of
specific securitization transactions.

     Derivative instruments used by Onyx involve, to varying degrees, elements
of credit risk in the event a counterparty should default and market risk as the
instruments are subject to rate and price fluctuations. Credit risk is managed
through the use of credit standard guidelines, counterparty diversification,
monitoring of counterparty financial condition and International Swap Dealers
Association master netting agreements in place with all derivative
counterparties.

     Accounting for Derivatives and Hedging Activities

     All derivatives are recognized on the balance sheet at their fair value. On
the date that the Company enters into a derivative contract, it designates the
derivative as a hedge of a forecasted transaction of the variability of cash
flows that are to be received or paid in connection with a recognized asset or
liability (a "cash flow" hedge). Changes in the fair value of a derivative that
are highly effective and previously designated to qualify as a cash flow hedge
to the extent that the hedge is effective, are recorded in other comprehensive
income until earnings are affected by the variability of cash flows of the
hedged transaction (e.g., until periodic settlements of a variable asset or
liability are recorded in earnings). Any hedge ineffectiveness (which represents
the amount by which the changes in the fair value of the derivative exceed the
variability in the cash flows of the forecasted transaction) is recorded in
current-period earnings.

     The Company formally documents all relationships between hedging
instruments and hedged items, as well as its risk-management objective and
strategy for undertaking various hedge transactions. This process includes
linking all derivatives that are designated as cash flow hedges or specific firm
commitments or forecasted transactions. The Company also formally assesses (both
at the hedge's inception and on an ongoing basis) whether the derivatives that
are used in hedging transactions have been highly effective in offsetting
changes in the cash flows of hedged items and whether those derivatives may be
expected to remain highly effective in future periods. When it is determined
that a derivative is not, or has ceased to be, highly effective as a hedge, the
Company discontinues hedge accounting prospectively, as discussed below.


                                      10

<PAGE>   11

                  ONYX ACCEPTANCE CORPORATION AND SUBSIDIARIES

        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                                   (UNAUDITED)


     The Company will discontinue hedge accounting prospectively when (1) it
determines that the derivative is no longer highly effective in offsetting
changes in the cash flows of a hedged item such as firm commitments or
forecasted transactions; (2) it is no longer probable that the forecasted
transaction will occur; (3) the derivative expires or is sold, terminated, or
exercised; or (4) management determines that designating the derivative as a
hedging instrument is no longer appropriate.

     ADOPTION OF SFAS NO. 140

     In September 2000, the FASB issued Statement of Financial Accounting
Standards No. 140, "Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities -- A Replacement of FAS 125." This Statement
replaces FAS 125, "Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities." It revises the standards for accounting for
securitizations and other transfers of financial assets and collateral and
requires certain disclosures, but it carries over most of FAS 125's provisions
without reconsideration. This Statement provides consistent standards for
distinguishing transfers of financial assets that are sales from transfers that
are secured borrowings. This Statement is effective for transfers and servicing
of financial assets and extinguishments of liabilities occurring after March 31,
2001. Adoption of SFAS No. 140 did not have a material effect on the Company's
financial statements.

NOTE 6 -- CONTINGENCIES

     The Company is party to various legal proceedings similar to actions
brought against other companies in the motor vehicle finance industry, which are
or may or may not be covered under insurance policies it holds. The Company
vigorously defends such proceedings; however, there is no assurance as to the
results. Based upon information presently available, the Company believes that
the final outcome of all such proceedings should not have a material adverse
effect upon the Company's results of operations, cash flows or financial
condition.

NOTE 7 -- SUBSEQUENT EVENTS

     During the third quarter of 2001 to date, the Company has securitized $400
million in Contracts. The Company has converted its loan accounting and
collection systems from an external service provider to an in-house system as of
July 1, 2001.


                                       11

<PAGE>   12

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

                                    OVERVIEW

     Onyx Acceptance Corporation ("Onyx" or the "Company") is a specialized
consumer finance company engaged in the purchase, securitization and servicing
of Contracts originated by franchised and select independent automobile
dealerships. The Company focuses its efforts on acquiring Contracts
collateralized by late model used and, to a lesser extent, new motor vehicles,
entered into with purchasers whom the Company believes have an acceptable credit
profile.

     The Company generates revenues primarily through the purchase, origination,
warehousing, subsequent securitization and ongoing servicing of Contracts. The
Company earns net interest income on Contracts held during the warehousing
period. Upon the securitization and sale of Contracts, the Company recognizes a
gain on sale of Contracts, receives future excess cash flows generated by owner
and grantor trusts, and earns fees from servicing the securitized Contracts.

     Prior to securitizing Contracts, the Company earns interest income on its
Contracts, pays interest on funds used to purchase the Contracts and absorbs any
credit losses. After securitization, the net earnings are recorded as retained
interest income, which is a component of interest income.

                              RESULTS OF OPERATIONS

NET INTEREST INCOME

     Net interest income consists primarily of the difference between the
finance revenue earned on Contracts held on the balance sheet during the
warehousing period and the interest costs associated with the Company's
borrowings to purchase such Contracts.

     Net interest income totaled approximately $5.9 million and $8.5 million for
the three and six-month period ended June 30, 2001 compared to $1.1 million and
$5.1 million for the same periods in 2000. The increase in net interest income
was primarily due to the adoption of Emerging Issues Task Force ("EITF") 99-20
and a reduction in interest expense related to the Company's warehouse financing
lines of credit. EITF 99-20 requires that the Company recognize income from its
retained interest in securitized assets on a level yield "accrual" method over
the remaining estimated life of the corresponding asset. Prior to 99-20, the
Company recognized income on its credit enhancement assets as a component of
service fee income.

GAIN ON SALE OF CONTRACTS

     The Company recorded a gain on sale of Contracts of $10.3 million and $19.6
million for the three and six-month periods ended June 30, 2001, compared to
$14.0 million and $26.7 million for the same periods in 2000. The reduction of
the gain was principally due to management's decision to target higher
credit-worthy borrowers, which resulted in a reduction in the size of the
securitizations, $800.0 million for such six-month period in 2001 versus $880.0
million in 2000. In addition, the Company's weighted average net interest rate
spread before issuance costs and losses on securitized Contracts declined to
5.04% for the six months ended June 30, 2001 versus 5.25% for the same period in
2000. The net interest rate spread is the difference between the weighted
average Contract rate of the securitized assets, and the weighted average
investor rate inclusive of all costs related to the sale. The net interest rate
spread is also affected by product mix, general market conditions and overall
market interest rates.

SERVICE FEE INCOME

     Service fee income includes contractual servicing income and other fee
income. Contractual service fee income is earned at a rate of 1% per annum on
the outstanding balance of Contracts securitized. Other fee income consists
primarily of documentation fees, late charges and deferment fees and is
dependent on the number of Contracts originated and the size of the serviced
portfolio. Increased competition may also affect the amount of other fee income
that the Company may earn when originating or servicing Contracts.


                                       12

<PAGE>   13

     Service fee income increased to $12.7 million and $25.8 million for the
three and six-month periods ended June 30, 2001, compared to $10.3 million and
$19.0 million for the same periods in 2000. These increases are due to higher
amounts of service fees as a result of the growth of the serviced portfolio.

PROVISION FOR CREDIT LOSSES

     The Company maintains an allowance for credit losses to cover anticipated
losses for Contracts held for sale. The allowance for credit losses is increased
by adjusting the provision for credit losses to cover additional Contracts
originated and increases in loss estimates and decreased by actual losses on the
Contracts held for sale or by the reduction of the amount of Contracts held for
sale. The level of the allowance is based principally on the outstanding balance
of Contracts held for sale and the historical loss trends for the period of time
the Contracts are held before being sold in a securitization. When the Company
sells Contracts in a securitization transaction, it reduces its allowance for
credit losses and factors probable losses into its calculation of gain on sale.
The Company believes that the allowance for credit losses is currently adequate
to absorb probable losses. The provision for credit losses totaled $130 thousand
and $464 thousand for the three and six-month periods ended June 30, 2001,
compared to $285 thousand and $718 thousand for the same periods in 2000.
Provision for credit losses consists of net credit losses incurred during the
warehousing period plus future provision for losses reserved against the net
changes in Contracts held for sale during the period. Net credit losses
accounted for $237 thousand and $460 thousand during the three and six-month
periods ended June 30, 2001, compared to $390 thousand and $685 thousand for the
same periods in 2000.

OPERATING EXPENSES

     Total operating expenses were $24.1 million or 3.45% of the average
serviced portfolio for the three months ended June 30, 2001 compared to $21.3
million or 3.53% of the average serviced portfolio for the same period in 2000.
For the six months ended June 30, 2001, total operating expenses were $45.7
million or 3.30% of the average serviced portfolio, versus $42.0 million or
3.60% of the average serviced portfolio for the six months ended June 30, 2000.
The dollar increase in total operating expenses is primarily attributable to an
increase in the average serviced portfolio for the period. The average serviced
portfolio increased to $2.8 billion for the six months ended June 30, 2001 from
$2.3 billion for the same period in 2000, an increase of approximately 21%.

     The Company incurred salary and benefit expenses of $14.2 million for the
three months ended June 30, 2001, compared to $12.6 million for the same period
in 2000. For the six months ended June 30, 2001 total salary and benefit
expenses were $26.7 million, versus $24.1 million for the same period in 2000.
This increase is attributable to the incremental staffing requirements related
to the expansion of operations and the growth of the serviced portfolio. The
number of employees at the Company, including temporary staff, increased from
1,036 at June 30, 2000, to 1,102 at June 30, 2001.

     System and servicing expenses remained stable at $1.5 million for the
quarters ended June 30, 2001 and 2000. For the six months ended June 30, 2001,
total system and servicing expenses also remained stable at $3.1 million, as the
Company renegotiated several contracts with its major service providers. The
Company acquired a loan accounting and collection system during 2000, and
intends to bring these processes in-house in the third quarter of 2001.

     Telephone and data line charges declined to $1.3 million from $1.5 million
for the second quarter of 2001 and 2000 respectively. For the six months ended
June 30, 2001 total telephone and data line charges were $2.5 million, versus
$3.2 million for the same period in 2000. Although these charges generally
increase with the growth of the serviced portfolio, the reduction between 2001
and 2000 was primarily due to renegotiated contracts for long distance rates
with certain carriers. Assuming no additional reduction in long distance rates,
the Company expects these charges to increase with the continued growth of the
serviced portfolio.

     Depreciation expenses increased slightly to $1.2 million for the three
months ended June 30, 2001 compared to $1.0 million for the same period in 2000.
For the six months ended June 30, 2000 and 2001, depreciation expense amounted
to $2.5 million and $2.0 million respectively, as the Company continued to
invest in technology and infrastructure. General and administrative expenses
increased to $5.9 million for the three months ended June 30,


                                       13

<PAGE>   14

2001 compared to $4.8 million for the same period in 2000. For the six months
ended June 30, 2001 and 2000, general and administrative expenses were $11.0
million and $9.7 million, respectively. Higher expenses are primarily due to the
growth of the average serviced portfolio.

INCOME TAXES

     The Company files federal and state tax returns. The effective tax rates
for March 31, 2001 and 2000 were 41.5%.

                               FINANCIAL CONDITION

CONTRACTS HELD FOR SALE

     Contracts held for sale totaled $170.2 million at June 30, 2001, compared
to $173.8 million at December 31, 2000. The balance in the held for sale
portfolio is largely dependent upon the timing of the origination and
securitization of Contracts. The Company completed securitization transactions
of $400.0 million during the first and second quarters of 2001. The Company
plans to continue to securitize Contracts on a regular basis.

     The following table illustrates the changes in the Company's Contract
acquisition volume, securitization activity and servicing portfolio during the
past five fiscal quarters:

                    SELECTED QUARTERLY FINANCIAL INFORMATION

<TABLE>
<CAPTION>
                                                                       FOR THE QUARTERS ENDED
                                                 ----------------------------------------------------------------------
                                                  JUNE 30,       SEPT. 30,      DEC. 31,       MAR. 31,       JUNE 30,
                                                    2000           2000           2000           2001           2001
                                                 ----------     ----------     ----------     ----------     ----------
                                                                         (DOLLARS IN THOUSANDS)
<S>                                              <C>            <C>            <C>            <C>            <C>
Contracts purchased/originated during period     $  434,144     $  367,636     $  401,181     $  430,524     $  379,595
Average monthly volume during period .......        144,714        122,545        133,727        143,508        126,531
Gain on sale of Contracts ..................         13,989         12,066          6,217          9,319         10,257
Contracts securitized during period ........        450,000        440,000        400,000        400,000        400,000
Servicing portfolio at period end ..........      2,500,207      2,584,152      2,690,606      2,784,411      2,807,181
</TABLE>

                                  ASSET QUALITY

     The Company monitors and attempts to minimize delinquencies and losses
through timely collections and the use of predictive dialing and other systems.
At June 30, 2001, delinquencies represented 2.23% of the amount of Contracts in
its serviced portfolio compared to 4.14% at December 31, 2000. Annualized net
charge-offs as a percentage of the average servicing portfolio were 2.67% for
the quarter ended June 30, 2001, compared to 2.23% for the same period in 2000.

     Off balance sheet reserves at June 30, 2001 were 4.4%, compared to 4.6% at
December 31, 2000. Off balance sheet reserves are those reserves established and
maintained on Contracts sold to the grantor and owner trusts in connection with
securitizations.

                  DELINQUENCY EXPERIENCE OF SERVICING PORTFOLIO

<TABLE>
<CAPTION>
                                             JUNE 30, 2001              DECEMBER 31, 2000
                                        -----------------------      -----------------------
                                          AMOUNT          NO.          AMOUNT          NO.
                                        ----------      -------      ----------      -------
                                                        (DOLLARS IN THOUSANDS)
<S>                                     <C>             <C>          <C>             <C>
Servicing portfolio ...............     $2,807,181      282,892      $2,690,606      269,372
Delinquencies(1)(2)
  31-59 days ......................     $   42,033        4,683      $   71,681        7,424
  60-89 days ......................         12,101        1,369          23,085        2,285
  90+ days ........................          8,490          984          16,748        1,749
                                        ----------      -------      ----------      -------
    Total .........................     $   62,624        7,036      $  111,514       11,458
                                        ==========      =======      ==========      =======
Total delinquencies as a percent of
  Servicing portfolio .............           2.23%        2.49%           4.14%        4.25%
</TABLE>

-----------
(1)  Delinquencies include principal amounts only, net of repossessed inventory
     and accounts in bankruptcy. Delinquent repossessed inventory as a percent
     of the serviced portfolio was 0.79% and 0.83% at June 30, 2001 and December
     31, 2000, respectively. Delinquent contracts in bankruptcy as a percent of
     the serviced portfolio was 0.76% and 0.52% at June 30, 2001 and December
     31, 2000, respectively.

(2)  The period of delinquency is based on the number of days payments are
     contractually past due.

                                       14

<PAGE>   15

                   LOAN LOSS EXPERIENCE OF SERVICING PORTFOLIO

<TABLE>
<CAPTION>
                                            FOR THE THREE MONTHS ENDED       FOR THE SIX MONTHS ENDED
                                                     JUNE 30,                       JUNE 30,
                                            --------------------------      --------------------------
                                               2001            2000            2001            2000
                                            ----------      ----------      ----------      ----------
                                                                             (DOLLARS IN THOUSANDS)
<S>                                         <C>             <C>             <C>             <C>
Period end Contracts outstanding ......     $2,807,181      $2,500,207      $2,807,181      $2,500,207
Average servicing portfolio(1) ........     $2,794,503      $2,415,843      $2,776,444      $2,326,900
Number of gross charge-offs ...........          3,508           2,551           6,616           4,912
Gross charge-offs .....................     $   22,322      $   15,895      $   43,229      $   30,950
Net charge-offs(2) ....................     $   18,627      $   13,439      $   37,115      $   26,491
Annualized net charge-offs as a percent
  of average Servicing portfolio ......           2.67%           2.23%           2.67%           2.28%
</TABLE>

------------
(1)  Average is based on daily balances.

(2)  Net charge-offs are gross charge-offs minus recoveries on Contracts
     previously charged off.

THE FOLLOWING TABLE ILLUSTRATES THE MONTHLY PERFORMANCE OF EACH OF THE
SECURITIZED POOLS OUTSTANDING FOR THE PERIOD FROM THE DATE OF SECURITIZATION
THROUGH JUNE 30, 2001:

<TABLE>
<CAPTION>

MONTH     97-2   97-3  97-4   98-1   98-A  98-B   98-C  99-A   99-B   99-C  99-D   00-A  00-B   00-C  00-D   01-A  01-B
-----     ----   ----  ----   ----   ----  ----   ----  ----   ----   ----  ----   ----  ----   ----  ----   ----   ----
<S>       <C>    <C>   <C>    <C>    <C>   <C>    <C>   <C>    <C>    <C>   <C>    <C>   <C>    <C>   <C>    <C>    <C>
  1       0.00%  0.00% 0.00%  0.00%  0.00% 0.00%  0.00% 0.00%  0.00%  0.00% 0.00%  0.00% 0.00%  0.00% 0.00%  0.00%  0.00%
  2       0.00%  0.00% 0.00%  0.01%  0.01% 0.00%  0.02% 0.00%  0.00%  0.01% 0.00%  0.00% 0.00%  0.00% 0.00%  0.00%  0.00%
  3       0.02%  0.02% 0.01%  0.02%  0.03% 0.02%  0.02% 0.02%  0.03%  0.03% 0.01%  0.02% 0.02%  0.01% 0.00%  0.00%
  4       0.07%  0.09% 0.04%  0.08%  0.07% 0.08%  0.04% 0.05%  0.07%  0.06% 0.04%  0.04% 0.04%  0.03% 0.02%  0.02%
  5       0.22%  0.13% 0.11%  0.14%  0.14% 0.19%  0.15% 0.11%  0.14%  0.16% 0.09%  0.11% 0.10%  0.06% 0.07%  0.07%
  6       0.32%  0.24% 0.20%  0.24%  0.23% 0.33%  0.27% 0.21%  0.27%  0.28% 0.15%  0.18% 0.17%  0.11% 0.15%
  7       0.59%  0.36% 0.28%  0.40%  0.37% 0.45%  0.46% 0.35%  0.43%  0.47% 0.24%  0.37% 0.30%  0.26% 0.26%
  8       0.80%  0.47% 0.43%  0.53%  0.42% 0.61%  0.57% 0.49%  0.60%  0.64% 0.43%  0.63% 0.44%  0.41% 0.39%
  9       0.91%  0.62% 0.55%  0.68%  0.51% 0.82%  0.74% 0.63%  0.85%  0.83% 0.59%  0.87% 0.67%  0.65%
 10       1.07%  0.73% 0.72%  0.85%  0.70% 0.95%  0.94% 0.81%  1.07%  1.09% 0.76%  1.05% 0.90%  0.85%
 11       1.26%  0.81% 0.87%  1.04%  0.85% 1.10%  1.12% 1.04%  1.34%  1.31% 0.99%  1.27% 1.11%  1.08%
 12       1.42%  0.94% 0.95%  1.20%  1.01% 1.20%  1.30% 1.29%  1.56%  1.47% 1.20%  1.59% 1.38%  1.29%
 13       1.58%  1.10% 1.08%  1.33%  1.17% 1.36%  1.54% 1.49%  1.79%  1.62% 1.41%  1.82% 1.57%
 14       1.68%  1.23% 1.19%  1.46%  1.37% 1.48%  1.73% 1.72%  1.90%  1.77% 1.52%  2.03% 1.84%
 15       1.80%  1.38% 1.36%  1.61%  1.48% 1.64%  1.90% 1.90%  2.08%  2.00% 1.70%  2.25% 2.08%
 16       1.97%  1.58% 1.42%  1.71%  1.59% 1.89%  2.10% 2.10%  2.23%  2.08% 2.00%  2.48%
 17       2.10%  1.68% 1.52%  1.88%  1.76% 2.05%  2.28% 2.26%  2.42%  2.29% 2.17%  2.64%
 18       2.23%  1.77% 1.64%  2.01%  1.96% 2.22%  2.51% 2.46%  2.63%  2.48% 2.40%
 19       2.35%  1.91% 1.75%  2.17%  2.07% 2.37%  2.71% 2.59%  2.71%  2.61% 2.61%
 20       2.48%  2.04% 1.85%  2.25%  2.25% 2.50%  2.83% 2.71%  2.89%  2.73% 2.87%
 21       2.59%  2.11% 1.97%  2.41%  2.37% 2.67%  2.95% 2.83%  3.08%  2.92% 3.05%
 22       2.72%  2.20% 2.08%  2.52%  2.48% 2.79%  3.08% 2.88%  3.21%  3.07%
 23       2.81%  2.31% 2.12%  2.63%  2.65% 2.92%  3.25% 3.03%  3.31%  3.22%
 24       2.85%  2.41% 2.23%  2.75%  2.76% 3.06%  3.39% 3.21%  3.43%
 25       2.93%  2.51% 2.36%  2.86%  2.81% 3.14%  3.45% 3.28%  3.55%
 26       2.96%  2.59% 2.41%  2.98%  2.95% 3.23%  3.57% 3.34%  3.67%
 27       3.09%  2.71% 2.52%  3.06%  2.99% 3.28%  3.72% 3.47%
 28       3.17%  2.79% 2.55%  3.15%  3.03% 3.35%  3.81% 3.61%
 29       3.22%  2.92% 2.62%  3.19%  3.12% 3.45%  3.91% 3.67%
 30       3.26%  2.94% 2.71%  3.26%  3.13% 3.50%  4.05%
 31       3.33%  3.01% 2.77%  3.33%  3.18% 3.57%  4.13%
 32       3.39%  3.04% 2.81%  3.40%  3.24% 3.67%  4.21%
 33       3.48%  3.08% 2.85%  3.42%  3.26% 3.73%
 34       3.51%  3.11% 2.88%  3.46%  3.28% 3.81%
 35       3.54%  3.20% 2.93%  3.53%  3.36%
 36       3.55%  3.21% 2.91%  3.56%  3.39%
 37       3.56%  3.23% 2.94%  3.59%  3.42%
 38       3.56%  3.24% 2.98%  3.64%
 39       3.58%  3.25% 3.00%  3.67%
 40       3.58%  3.27% 3.01%  3.68%
 41       3.58%  3.32% 3.03%
 42       3.59%  3.34% 3.04%
 43       3.60%  3.36% 3.07%
 44       3.61%  3.40%
 45       3.61%  3.39%
 46       3.62%  3.38%
</TABLE>


                                       15


<PAGE>   16

                         LIQUIDITY AND CAPITAL RESOURCES

     The Company requires substantial cash and capital resources to operate its
business. Its primary uses of cash include: (i) acquisition of Contracts; (ii)
payments of dealer participation; (iii) securitization costs; (iv) settlements
of hedging transactions; (v) operating expenses; and (vi) interest expense. The
capital resources available to the Company include: (i) interest income during
the warehousing period; (ii) servicing fees; (iii) releases from spread
accounts; (iv) settlements of hedging transactions; (v) sales of Contracts in
securitizations; and (vi) borrowings under its credit facilities. Management
believes that the resources available to the Company provide the needed capital
to fund the anticipated expansion of the Company, Contract purchases, and
investments in origination and servicing capabilities.

     Cash provided by operating activities was $417.0 thousand for the six
months ended June 30, 2001, compared to $25.8 million provided in the six months
ended June 30, 2000. Cash provided by operating activities during the first half
of 2000 was primarily due to the securitization of the Company's residual cash
flows from 15 of its then outstanding securitizations, resulting in a cash
inflow of approximately $49.0 million. A portion of the proceeds of this
transaction was used to pay down two of the Company's residual financing
facilities and to pay off a third residual financing facility. Cash used in
investing activities was $1.5 million for the six months ended June 30, 2001,
compared to $2.7 million for the six months ended June 30, 2000. The reduction
in investing activities is partially due to an increase in the Company's use of
capital lease lines for acquisitions of furniture and computer equipment in
2001. Cash provided by financing activities was $3.9 million for the six months
ended June 30, 2001, compared to $17.2 million used during the six months ended
June 30, 2000. The difference was primarily due to the Company reducing its
residual lines of credit during March 2000 in connection with the residual
securitization.

     CP Facilities: As of June 30, 2001, the Company was party to two primary
Contract warehousing programs (the "CP Facilities"), one a $355 million facility
with Triple-A One Funding Corporation ("Triple-A"), and the other a $150 million
facility with Park Avenue Receivables Corporation ("Parco"). Two of the
Company's special purpose subsidiaries, Onyx Acceptance Financial Corporation
("Finco") for the Triple-A Facility and Onyx Acceptance Receivables Corporation
("Recco") for the Parco Facility, are the borrowers under the CP Facilities. The
CP Facilities are used to fund the purchase or origination of Contracts.
Triple-A and Parco are both rated commercial paper asset-backed conduits
sponsored by MBIA Insurance Corporation ("MBIA") and The Chase Manhattan Bank
("Chase"), respectively. MBIA provides credit enhancement for both facilities by
issuing financial guarantee insurance policies covering all principal and
interest obligations owed for the borrowings under the facilities. The Company
pledges its Contracts held for sale to borrow from Triple-A and from Parco. The
Parco Facility will expire in August 2001 and will not be renewed. The Triple-A
Facility is scheduled to expire in September 2001. The Company and the lender
are currently working on the renewal of the facility.


                                       16
<PAGE>   17

     The Residual Lines: The Company, through Fundco, currently has two residual
financing facilities: a $50.0 million line with Salomon Smith Barney Realty
Corporation ("SBRC") and a $35.0 million facility with Credit Suisse First
Boston (Europe) Limited, as buyer ("CSFB-Europe"), and Credit Suisse First
Boston Corporation, as agent ("CSFB") executed in October 2000. (The SBRC
facility together with the CSFB-Europe facility described above are sometimes
referred to herein as the "Residual Lines"). The Residual Lines are used by the
Company to finance operating requirements. The lines utilize collateral-based
formulas that set borrowing availability to a percentage of the value of excess
cash flow to be received from certain securitizations. A $20.0 million facility
with Merrill Lynch International ("MCI") expired in May 2001 and was not
renewed. Each loan under the SBRC line or the CSFB-Europe line matures one year
after the date of the loan; the Company expects each loan to be renewed at term.

     Subordinated Debt: As of June 30, 2001, the Company had outstanding
approximately $17.9 million of subordinated debt. $5.9 million of this amount is
being amortized through February 2003 with a stated interest rate of 9.5%. The
remaining balance has a stated interest rate of 12.5% and a maturity of June
2006.

     The facilities and lines above contain affirmative, negative and financial
covenants typical of such credit facilities. The Company was in compliance with
these covenants as of June 30, 2001.

     Hedging and Interest Rate Risk Management. The Company employs a hedging
strategy that is intended to minimize the risk of interest rate fluctuations and
which historically has involved the execution of forward interest rate swaps or
use of a pre-funding structure for the Company's securitizations. The Company is
not required to maintain collateral on the outstanding hedging program.

Securitizations

     Regular securitizations are an integral part of the Company's business plan
because they allow the Company to increase its liquidity, provide for
redeployment of its capital and reduce risks associated with interest rate
fluctuations. The Company has developed a securitization program that involves
selling interests in pools of its Contracts to investors through the public
issuance of AAA/Aaa rated asset-backed securities. The Company completed a
AAA/Aaa rated publicly underwritten asset-backed securitization in the amount of
$400 million in the second quarter of 2001.

     To date, during the third quarter of 2001, the Company has executed a
securitization totaling $400 million.

     The net proceeds of securitizations are used to pay down outstanding
indebtedness incurred under the Company's credit facilities to purchase
Contracts, thereby creating availability for the purchase of additional
Contracts. Through June 30, 2001, the Company has securitized $6.0 billion of
its Contracts in 24 separate transactions. In each of its securitizations, the
Company has sold its Contracts to a newly formed grantor or owner trust, which
issues certificates and/or notes in an amount equal to the aggregate principal
balance of the Contracts.

     The Company arranges for credit enhancement to achieve an improved credit
rating on the asset-backed securities issued. This credit enhancement has taken
the form of a financial guaranty insurance policy issued by MBIA or a
predecessor of MBIA (the "Financial Guarantee Insurance Policy"), insuring the
payment of principal and interest due on the asset-backed securities.

     The Company receives servicing fees for its duties relating to the
accounting for and collection of the Contracts. In addition, the Company is
entitled to the future excess cash flows arising from the trusts. Generally, the
Company sells the Contracts at face value and without recourse, except that
certain representations and warranties with respect to the Contracts are
provided by the Company as the servicer and Finco as the seller to the trusts.

     Gains on sale of Contracts arising from securitizations provide a
significant portion of the Company's revenues. Several factors affect the
Company's ability to complete securitizations of its Contracts, including
conditions in the securities markets generally, conditions in the asset-backed
securities market specifically, the credit quality of the Company's portfolio of
Contracts and the Company's ability to obtain credit enhancement.


                                       17

<PAGE>   18

INTEREST RATE EXPOSURE AND HEDGING

     The Company is able through the use of varying maturities on advances from
the CP Facilities to lock in rates during the warehousing period, when in
management's judgment it is appropriate, to limit interest rate exposure during
such warehousing period (See "Risk Factors -- Interest Rate Risk").

     The Company has the ability to move rates upward in response to rising
borrowing costs because the Company currently does not originate Contracts near
the maximum rates permitted by law. Further, the Company employs a hedging
strategy, which primarily consists of the execution of forward interest rate
swaps. These hedges are entered into by the Company in numbers and amounts,
which generally correspond to the anticipated principal amount of the related
securitization. Gains and losses relative to these hedges are recognized in full
at the time of securitization as an adjustment to the gain on sale of the
Contracts. The Company has only used counterparties with investment grade debt
ratings from national rating agencies for its hedging transactions.

     Management monitors the Company's hedging activities on a frequent basis to
ensure that the hedges, their correlation to the total consideration to be
received in the forecasted securitization and the amounts being hedged continue
to provide effective protection against interest rate risk. The Company's
hedging strategy requires estimates by management of monthly Contract
acquisition volume and timing of its securitizations. If such estimates are
materially inaccurate, then the Company's gain on sales of Contracts and results
of operations and cash flows could be adversely affected. The amount and timing
of hedging transactions are determined by senior management based upon the
amount of Contracts purchased and the interest rate environment.

NEW ACCOUNTING PRONOUNCEMENTS

     In July 2001, the Financial Accounting Standards Board issued Statements on
Financial Accounting Standards (SFAS) Nos. 141 (Business Combinations) and 142
(Goodwill and Other Intangible Assets). SFAS No. 141, among other things,
eliminates the use of the pooling of interests method of accounting for business
combinations. Under the provisions of SFAS No. 142 goodwill will no longer be
amortized, but will be subject to a periodic test for impairment based upon fair
values. SFAS No. 141 is effective for all business combinations initiated after
June 30, 2001. SFAS No. 142 will be effective for the Company beginning January
1, 2002. The adoption of these statements is not expected to have a material
effect on the Company's financial statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Because the Company's funding strategy is dependent upon the issuance of
interest-bearing securities and the incurrence of debt, fluctuations in interest
rates impact the Company's profitability. As a result, the Company employs
various hedging strategies to limit certain risks of interest rate fluctuations.
See "Management's Discussion and Analysis -- Hedging and Interest Rate Risk
Management" and "Risk Factors -- We Are Subject to Interest Rate Fluctuations."

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

     As a consumer finance company, the Company is subject to various consumer
claims and litigation seeking damages and statutory penalties based upon, among
other things, disclosure inaccuracies and wrongful repossession, which could
take the form of a plaintiff's class action complaint. The Company, as the
assignee of finance Contracts originated by dealers, may also be named as a
co-defendant in lawsuits filed by consumers principally against dealers.
Finally, the Company also is subject to other litigation common to the motor
vehicle finance industry and businesses in general. The damages and penalties
claimed by consumers and others in these types of matters can be substantial.
The relief requested by the plaintiffs varies but includes requests for
compensatory, statutory and punitive damages. The Company is currently a
defendant in three consumer class action lawsuits. One such proceeding, served
in 1999, in which the Company is a defendant, has been brought as a class action
and is pending in the State of California. A class was certified in 2000; in the
matter, the plaintiffs raise issues regarding the payment of dealer
participation to dealers. The trial in this matter has been concluded and the
Company is awaiting the entry of the court's final decision. Another such
proceeding, served in 2000, in which the Company is a defendant, was brought as
a putative class action and is pending in the state of New Jersey. This case
settled for a nominal amount and will be dismissed once the settlement
documentation is finalized.


                                       18
<PAGE>   19

     In another such consumer class action, filed and served in 1999, pending in
Orange County Superior Court in the state of California, and entitled Jason
Bollinger v. Onyx Acceptance Corporation (Action number 807831), the plaintiffs
alleged that the Company sent defective post-repossession notices to certain
California borrowers following the repossession or voluntary surrender of their
vehicles. The Company, without admitting liability, entered into a settlement
agreement with respect to this matter, and this agreement was approved by the
court in October 2000. Under the terms of the settlement, the Company refunded
certain amounts collected on deficiencies related to class members' accounts (in
some instances, with interest) and paid a certain portion of the plaintiff's
counsel fees and other amounts. Pursuant to the settlement, the monies from
refund checks not cashed by the class members cannot be returned to the Company.
In accordance with the settlement, these amounts shall be paid as follows:
one-half to the plaintiff's counsel up to a negotiated cap, as an additional
attorney's fee award, and the remainder to a non-profit youth soccer
organization in Orange County, California where the Company's headquarters is
located. One of the children of Mr. Hall, the Company's President and Chief
Executive Officer, participates in this organization. Mr. Hall has also
volunteered in certain capacities in this organization.

     On January 25, 2000, a putative class action complaint was filed against
the Company and certain of the Company's officers and directors alleging
violations of Section 10(b) and 20(a) of the Securities and Exchange Act of 1934
arising from the Company's use of the cash-in method of measuring and accounting
for credit enhancement assets in the financial statements. The matter is
entitled D. Colin v. Onyx Acceptance Corporation, et al. in the U.S. District
Court for the Central District of California (Case number SACV 00-0087
(GLT)(EEx)). The Company believes that its previous use of the cash-in method of
measuring and accounting for credit enhancement assets was consistent with then
current generally accepted accounting principles and accounting practices of
other finance companies. As required by the Financial Accounting Standards
Board's Special Report, "A Guide to Implementation of Statement 125 on
Accounting for Transfers and Servicing of Financial Assets and Extinguishment of
Liabilities, Second Edition," dated December 1998 and related statements made by
the staff of the Securities and Exchange Commission, the Company retroactively
changed the method of measuring and accounting for credit enhancement assets to
the cash-out method and restated the Company's financial statements for 1996,
1997 and the first three fiscal quarters of 1998. In February 2001, an amended
complaint was dismissed with prejudice by the court; the plaintiff has appealed
this dismissal.

     Management believes that the Company has taken prudent steps to address the
litigation risks associated with the Company's business activities. However,
there can be no assurance that the Company will be able to successfully defend
against all such claims or that the determination of any such claim in a manner
adverse to the Company would not have a material adverse effect on the Company's
automobile finance business.

     In the opinion of management, the resolution of the proceedings described
in this section will not have a material adverse effect on the Company's
consolidated financial position, results of operations or liquidity.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     The Company held its Annual Meeting of Stockholders on May 31, 2001 (the
"Meeting"). At the Meeting, the stockholders were asked to vote on several
Company proposals.

1. Election of directors.

     The stockholders elected the director nominee, John W. Hall, to serve for a
     three year term expiring at the Annual Meeting in the year 2004.

                                    VOTES FOR    VOTES AGAINST    ABSTENTIONS
                                    ---------    -------------    -----------
     THE VOTING WENT AS FOLLOWS:    4,482,853       162,612


                                       19

<PAGE>   20

     The stockholders elected the director nominee, Thomas C. Stickel, to serve
     for a three year term expiring at the Annual Meeting in the year 2004.

                                    VOTES FOR    VOTES AGAINST    ABSTENTIONS
                                    ---------    -------------    -----------
     THE VOTING WENT AS FOLLOWS:    4,588,353       57,112

2. Ratification of the selection of independent accountants.

     The proposal to ratify the selection of PricewaterhouseCoopers LLP as the
Company's independent auditors for the fiscal year ending December 31, 2001 was
also approved by the stockholders.

                                    VOTES FOR    VOTES AGAINST    ABSTENTIONS
                                    ---------    -------------    -----------
     THE VOTING WENT AS FOLLOWS:    4,627,657       12,108           5,700

ITEM 5. OTHER INFORMATION

FORWARD LOOKING STATEMENTS

     The preceding Management's Discussion and Analysis of the Company's
Financial Condition and Results of Operations contains certain "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995, which provides a "safe harbor" for these types of statements. This
Quarterly Report on Form 10-Q contains forward-looking statements which reflect
the current views of Onyx Acceptance Corporation with respect to future events
and financial performance. These forward looking statements are subject to
certain risks and uncertainties, including those identified below which could
cause actual results to differ materially from historical results or those
anticipated. Forward-looking terminology can be identified by the use of terms
such as "may," "will," "expect," "anticipate," "estimate," "should" or
"continue" or the negative thereof or other variations thereon or comparable
terminology. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of their dates. Onyx Acceptance
Corporation undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. The following factors could cause actual results to differ
materially from historical results or those anticipated: (1) the level of demand
for auto contracts, which is affected by such external factors as the level of
interest rates, the strength of the various segments of the economy, debt burden
held by consumers and demographics of the lending markets of Onyx Acceptance
Corporation; (2) continued dealer relationships; (3) fluctuations between
consumer interest rates and the cost of funds; (4) federal and state regulation
of auto finance operations; (5) competition within the consumer lending
industry; (6) the availability and cost of securitization transactions and (7)
the availability and cost of warehouse and residual financing.

RISK FACTORS

     You should carefully consider the following risks in your evaluation of us
and our Common Stock. The risks and uncertainties described below are not the
only ones facing our Company. Additional risks and uncertainties, including but
not limited to credit, economic, competitive, governmental and financial factors
affecting our operations, markets, financial products, and services and other
factors discussed in our filings with the Securities and Exchange Commission,
may also adversely impact and impair our business. If any of these risks
actually occur, our business, results of operations, cash flows or financial
condition would likely suffer. In such case, the trading price of our common
stock could decline, and you may lose all or part of the money you paid to buy
our common stock.

 We Need Substantial Liquidity.

     We require a substantial amount of liquidity to operate our business. Among
other things, we use such liquidity to:

     o  acquire Contracts;

     o  pay dealer participation;

     o  pay securitization costs and fund related accounts;

     o  settle hedge transactions;

     o  satisfy working capital requirements and pay operating expenses; and

     o  pay interest expense.


                                       20

<PAGE>   21

     A significant portion of our revenues in any period is represented by gain
on sale of Contracts generated by a securitization in such period, but the cash
underlying such revenues is received over the life of the Contracts.

     We have operated on a negative cash flow basis and expect to do so in the
future as long as the volume of Contract purchases continues to grow. We have
historically funded these negative operating cash flows principally through
borrowings from financial institutions, sales of equity securities and sales of
subordinated notes. We cannot assure you, however, that (1) we will have access
to the capital markets in the future for equity, debt issuances or
securitizations, or (2) financing through borrowings or other means will be
available on acceptable terms to satisfy our cash requirements. If we are unable
to access the capital markets or obtain acceptable financing, our results of
operations, financial condition and cash flows would be materially and adversely
affected.

We Depend on Warehouse Financing.

     We depend on warehousing facilities with financial institutions to finance
the purchase or origination of Contracts pending securitization. Our business
strategy requires that such financing continue to be available during the
warehouse period.

     Whether the CP Facilities continue to be available to us depends on, among
other things, whether we maintain a target net yield for the Contracts financed
under the CP Facilities and comply with certain financial covenants contained in
the sale and servicing agreements between us, as seller, and our wholly-owned
special purpose finance subsidiaries, Finco or Recco, as applicable, as
purchaser. These financial covenants include:

     o  a minimum ratio of net worth plus subordinated debt to total assets;

     o  a maximum ratio of credit enhancement assets to tangible net worth;

     o  earnings before interest, depreciation and taxes coverage ratio; and

     o  minimum cash on hand.

     We cannot assure you that our CP Facilities will be available to us or that
they will be available on favorable terms. If we are unable to arrange new
warehousing credit facilities or extend our existing credit facilities when they
expire, our results of operations, financial condition and cash flows could be
materially and adversely affected.

We Depend on Residual Financing.

     When we sell our Contracts in securitizations, we receive cash and a
residual interest in the securitized assets ("RISA"). The RISA represents the
future cash flows to be generated by the Contracts in excess of the interest
paid on the securities issued in the securitization and other costs of servicing
the Contracts and completing the securitization. We typically use the RISA from
each securitization as collateral to borrow cash to finance our operations. The
amount of cash advanced by our lenders under our Residual Lines depends on a
collateral formula that is determined in large part by how well our securitized
Contracts perform. If our portfolio of securitized Contracts experienced higher
delinquency and loss ratios than expected, then the amount of money we could
borrow under the Residual Lines would be reduced. The reduction in availability
under these Residual Lines could materially and adversely affect our operations,
financial condition and cash flows. Additionally, we are subject, under the
documentation governing the Residual Lines, to certain financial covenants.


                                       21

<PAGE>   22

We Depend on Securitizations to Generate Revenue.

     We rely significantly upon securitizations to generate cash proceeds for
repayment of our warehouse and our residual credit facilities and to create
availability to purchase additional Contracts. Further, gain on sale of
Contracts generated by our securitizations represents a significant portion of
our revenues. Our ability to complete securitizations of our Contracts is
affected by the following factors, among other things:

     o  conditions in the securities markets generally;

     o  conditions in the asset-backed securities market specifically;

     o  the credit quality of our portfolio of Contracts; and

     o  our ability to obtain credit enhancement.

     If we were unable to profitably securitize a sufficient number of our
Contracts in a particular financial reporting period, then our revenues for such
period could decline and could result in lower net income or a loss for such
period. In addition, unanticipated delays in closing a securitization could also
increase our interest rate risk by increasing the warehousing period for our
Contracts.

 We Depend on Credit Enhancement.

     From inception through June 30, 2001, each of our securitizations (other
than the residual securitization) has utilized credit enhancement in the form of
a financial guarantee insurance policy in order to achieve "AAA/Aaa" ratings.
This form of credit enhancement reduces the cost of the securitizations relative
to alternative forms of credit enhancements currently available to us. We cannot
assure you that:

     o  we will be able to continue to obtain credit enhancement in any form
        from our current provider;

     o  we will be able to obtain credit enhancement from any other provider of
        credit enhancement on acceptable terms; or

     o  future securitizations will be similarly rated.

     We also rely on financial guarantee insurance policies to reduce our
borrowing cost under the CP Facilities. If our current provider's credit rating
is downgraded or if it withdraws our credit enhancement, we could be subject to
higher interest costs for our future securitizations and financing costs during
the warehousing period. Such events could have a material adverse effect on our
results of operations, financial condition and cash flows.

 We Are Subject to Interest Rate Fluctuations.

     Our profitability is largely determined by the difference, or "spread,"
between the effective rate of interest received by us on the Contracts acquired
and the interest rates payable under our credit facilities during the
warehousing period and for securities issued in securitizations.

     Several factors affect our ability to manage interest rate risk. First, the
Contracts are purchased or originated at fixed interest rates, while amounts
borrowed under our credit facilities bear interest at variable rates that are
subject to frequent adjustment to reflect prevailing rates for short-term
borrowings. Our policy is to increase the buy rates we issue to dealerships or,
for the Contracts we originate, to increase rates we make available to consumers
for Contracts in response to increases in our cost of funds during the
warehousing period. However, there is generally a time lag before such increased
borrowing costs can be offset by increases in the buy rates for Contracts and,
in certain instances, the rates charged by our competitors may limit our ability
to pass through our increased costs of warehouse financing.

     Second, the spread can be adversely affected after a Contract is purchased
or originated and while it is held during the warehousing period by increases in
the prevailing rates in the commercial paper markets. While the CP Facilities
permit us to select maturities of up to 270 days for commercial paper, if we
selected a shorter maturity or had a delay in completing a securitization, we
would face this risk.


                                       22

<PAGE>   23

     Third, the interest rate demanded by investors in securitizations is a
function of prevailing market rates for comparable transactions and the general
interest rate environment. Because the Contracts purchased or originated by us
have fixed rates, we bear the risk of spreads narrowing because of interest-rate
increases during the period from the date the Contracts are purchased until the
pricing of our securitization of such Contracts. We employ a hedging strategy
that is intended to minimize this risk and which historically has involved the
execution of forward interest rate swaps or use of a pre-funding structure for
our securitizations. However, we cannot assure you that this strategy will
consistently or completely offset adverse interest-rate movements during the
warehousing period or that we will not sustain losses on hedging transactions.
Our hedging strategy requires estimates by management of monthly Contract
acquisition volume and timing of our securitizations. If such estimates are
materially inaccurate, then our gains on sales of Contracts, results of
operations and cash flows could be materially and adversely affected.

     We also have exposure to interest rate fluctuations under the Residual
Lines. The interest rates are based on 30 day LIBOR and reset each month. In
periods of increasing interest rates our cash flows, results of operations and
financial condition could be adversely affected.

     In addition, we have some interest rate exposure to falling interest rates
to the extent that the interest rates charged on Contracts sold in a
securitization with a pre-funding structure decline below the rates prevailing
at the time that the securitization prices. Such a rate decline would reduce the
interest rate spread because the interest rate on the notes and/or the
certificates would remain fixed. This would negatively impact the gains on sale
of Contracts and our results of operations and cash flows.

We Will Be Adversely Affected When Contracts are Prepaid or Defaulted.

     Our results of operations, financial condition, cash flows, and liquidity
depend, to a material extent, on the performance of Contracts purchased,
originated, warehoused, and securitized by us. A portion of the Contracts
acquired by us may default or prepay during the warehousing period. We bear the
risk of losses resulting from payment defaults during the warehousing period. In
the event of payment default, the collateral value of the financed vehicle may
not cover the outstanding Contract balance and costs of recovery. We maintain an
allowance for credit losses on Contracts held during the warehousing period
which reflects management's estimates of anticipated credit losses during such
period. If the allowance is inadequate, then we would recognize as an expense
the losses in excess of such allowance, and our results of operations could be
adversely affected. In addition, under the terms of the CP Facilities, we are
not able to borrow against defaulted Contracts.

     Our servicing income can also be adversely affected by prepayment of or
defaults under Contracts in the serviced portfolio. Our contractual servicing
revenue is based on a percentage of the outstanding principal balance of such
Contracts. Thus, if Contracts are prepaid or charged-off, then our servicing
revenue will decline to the extent of such prepaid or charged-off Contracts.

     The gain on sale of Contracts recognized by us in each securitization and
the value of the retained interest in securitized assets ("RISA") in each
transaction reflects management's estimate of future credit losses and
prepayments for the Contracts included in such securitization. If actual rates
of credit loss or prepayments, or both, on such Contracts exceed those
estimated, the value of the RISA would be impaired. We periodically review our
credit loss and prepayment assumptions relative to the performance of the
securitized Contracts and to market conditions. Our results of operations and
liquidity could be adversely affected if credit loss or prepayment levels on
securitized Contracts substantially exceed anticipated levels. If necessary, we
would write-down the value of the RISA through a reduction to servicing fee
income. Further, any write down of RISA could reduce the amount available to us
under our Residual Lines, thus requiring us to pay down amounts outstanding
under the facilities or provide additional collateral to cure the borrowing base
deficiency.

We Will Be Adversely Affected If We Lose Servicing Rights.

     Our results of operations, financial condition and cash flows would be
materially and adversely affected if any of the following were to occur:

     o  loss of the servicing rights under our sale and servicing agreements for
        the CP Facilities;

     o  loss of the servicing rights under the applicable pooling and servicing
        or sale and servicing agreement of a grantor trust or owner trust,
        respectively; or

     o  a trigger event that would block release of future excess cash flows
        generated from the grantor trusts' or owner trusts' respective spread
        accounts.


                                       23

<PAGE>   24

     We are entitled to receive servicing income only while we act as servicer
under the applicable sales and servicing agreements or pooling and servicing
agreements. Under the CP Facilities our right to act as servicer can be
terminated by our lender or financial insurer, upon the occurrence of certain
events.

Our Quarterly Earnings May Fluctuate.

     Our revenues have fluctuated in the past and are expected to fluctuate in
the future principally as a result of the following factors:

     o  the timing and size of our securitizations;

     o  variations in the volume of our Contract acquisitions;

     o  the interest rate spread between our cost of funds and the average
        interest rate of purchased Contracts;

     o  the effectiveness of our hedging strategies; and

     o  the investor rate for securitizations.

     Any significant decrease in our quarterly revenues could have a material
adverse effect on our results of operations, financial condition, cash flows and
stock price.

We Depend on Key Personnel.

     Our future operating results depend in significant part upon the continued
service of our key senior management personnel, none of whom is bound by an
employment agreement. Our future operating results also depend in part upon our
ability to attract and retain qualified management, technical, and sales and
support personnel for our operations. Competition for such personnel is intense.
We cannot assure you that we will be successful in attracting or retaining such
personnel. The loss of any key employee, the failure of any key employee to
perform in his or her current position or our inability to attract and retain
skilled employees, as needed, could materially and adversely affect our results
of operations, financial condition and cash flows.

Our Industry is Highly Competitive.

     Competition in the field of financing retail motor vehicle sales is
intense. The automobile finance market is highly fragmented and historically has
been serviced by a variety of financial entities including the captive finance
affiliates of major automotive manufacturers, as well as banks, savings
associations, independent finance companies, credit unions and leasing
companies. Several of these competitors have greater financial resources than we
do. Many of these competitors also have long-standing relationships with
automobile dealerships, and offer dealerships or their customers other forms of
financing or services not provided by us. Our ability to compete successfully
depends largely upon our relationships with dealerships and the willingness of
dealerships to offer those Contracts that meet our underwriting criteria to us
for purchase. We cannot assure you that we will be able to continue to compete
successfully in the markets we serve.

We May Be Harmed by Adverse Economic Conditions.

     We are a motor vehicle consumer auto finance company whose activities are
dependent upon the sale of motor vehicles. Our ability to continue to acquire
Contracts in the markets in which we operate and to expand into additional
markets is dependent upon the overall level of sales of new and used motor
vehicles in those markets. A prolonged downturn in the sale of new and used
motor vehicles, whether nationwide or in the California markets, could have an
adverse impact upon us, our results of operations and our ability to implement
our business strategy.


                                       24

<PAGE>   25

     The automobile industry generally is sensitive to adverse economic
conditions both nationwide and in California, where we have our largest
single-state exposure. Periods of rising interest rates, reduced economic
activity or higher rates of unemployment generally result in a reduction in the
rate of sales of motor vehicles and higher default rates on motor vehicle
contracts. We cannot assure you that such economic conditions will not occur, or
that such conditions will not result in severe reductions in our revenues or the
cash flows available to us to permit us to remain current on our credit
facilities.

We Are Subject to System Risks.

     As of July 1, 2001, the Company converted from an external service provider
for its loan accounting and collections system to an in-house system. If issues
with the in-house system arise in the future, we may be unable to fund Contracts
and service the outstanding portfolio. The failure of this process could
materially and adversely affect our results of operations, financial condition
and cash flows.

We Are Subject to Many Regulations.

     Our business is subject to numerous federal and state consumer protection
laws and regulations, which, among other things:

     o  require us to obtain and maintain certain licenses and qualifications;

     o  limit the interest rates, fees and other charges we are allowed to
        charge;

     o  limit or prescribe certain other terms of our Contracts;

     o  require specific disclosures; and

     o  define our rights to repossess and sell collateral.

     We believe that we are in compliance in all material respects with all such
laws and regulations, and that such laws and regulations have had no material
adverse effect on our ability to operate our business. However, we will be
materially and adversely affected if we fail to comply with:

     o  applicable laws and regulations;

     o  changes in existing laws or regulations;

     o  changes in the interpretation of existing laws or regulations; or

     o  any additional laws or regulations that may be enacted in the future.

We Are Subject to Litigation Risks.

     We are party to various legal proceedings, similar to actions brought
against other companies in the motor vehicle finance industry and other
businesses. Companies in the motor vehicle finance industry have also been named
as defendants in an increasing number of class action lawsuits brought by
purchasers of motor vehicles claiming violation of various federal and state
consumer credit and similar laws and regulations. We are defendants in three
such consumer class action lawsuits. One such proceeding, served in 1999, in
which we are a defendant, has been brought as a putative class action and is
pending in the State of California. A class was certified in 2000; in the
matter, the plaintiffs raise issues regarding the payment of dealer
participation to dealers. The trial in this matter has been concluded and we are
awaiting the entry of the court's final decision. Another such proceeding,
served in 2000, in which we are a defendant, was brought as a putative class
action and is pending in the state of New Jersey. This case settled for a
nominal amount and will be dismissed once the settlement documentation is
finalized.


                                       25
<PAGE>   26

     In another such consumer class action, filed and served in 1999, pending in
Orange County Superior Court in the state of California, and entitled Jason
Bollinger v. Onyx Acceptance Corporation (Action number 807831), the plaintiffs
alleged that we sent defective post-repossession notices to certain California
borrowers following the repossession or voluntary surrender of their vehicles.
Without admitting liability, we entered into a settlement agreement with respect
to this matter, and this agreement was approved by the court in October 2000.
Under the terms of the settlement, we refunded certain amounts collected on
deficiencies related to class members' accounts (in some instances, with
interest) and paid a certain portion of the plaintiff's counsel fees and other
amounts. Pursuant to the settlement, the monies from refund checks not cashed by
the class members cannot be returned to us. In accordance with the settlement,
these amounts shall be paid as follows: one-half to the plaintiff's counsel up
to a negotiated cap, as an additional attorney's fee award, and the remainder to
a non-profit youth soccer organization in Orange County, California where the
our headquarters is located. One of the children of Mr. Hall, the Company's
President and Chief Executive Officer, participates in this organization. Mr.
Hall has also volunteered in certain capacities in this organization.

     On January 25, 2000, a putative class action complaint was filed against us
and certain of our officers and directors alleging violations of Section 10(b)
and 20(a) of the Securities and Exchange Act of 1934 arising from our use of the
cash-in method of measuring and accounting for credit enhancement assets in the
financial statements. The matter is entitled D. Colin v. Onyx Acceptance
Corporation, et al. in the U.S. District Court for the Central District of
California (Case number SACV 00-0087 (GLT)(EEx)). We believe that our previous
use of the cash-in method of measuring and accounting for credit enhancement
assets was consistent with then current generally accepted accounting principles
and accounting practices of other finance companies. As required by the
Financial Accounting Standards Board's Special Report, "A Guide to
Implementation of Statement 125 on Accounting for Transfers and Servicing of
Financial Assets and Extinguishment of Liabilities, Second Edition," dated
December 1998 and related statements made by the staff of the Securities and
Exchange Commission, we retroactively changed the method of measuring and
accounting for credit enhancement assets to the cash-out method and restated our
financial statements for 1996, 1997 and the first three fiscal quarters of 1998.
In February 2001, an amended complaint was dismissed with prejudice by the
court; the plaintiff has appealed the dismissal.

     While we intend to vigorously defend ourselves against such proceedings,
there is a chance that our results of operations, financial condition and cash
flows could be materially and adversely affected by unfavorable outcomes.

ITEM 6. EXHIBITS AND REPORTS OF FORM 8-K

     (a) Exhibits

     EXHIBIT
     NUMBER                             EXHIBIT TITLE
     -------                            -------------
     10.109     Daybreak-The Big Picture Master License Agreement

     10.110     SuperSolutions Corporation Daybreak-The Big Picture Service
                Level Agreement

     21.1       Subsidiaries of the Registrant.

     (b) REPORTS ON FORM 8-K

         None.


                                       26
<PAGE>   27

                                    SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                           ONYX ACCEPTANCE CORPORATION

                                           By: /s/ JOHN W. HALL
                                               ---------------------------------
                                                   John W. Hall
                                                   President and
                                                   Principal Executive Officer


Date: August 14, 2001

                                           By: /s/ DON P. DUFFY
                                               ---------------------------------
                                                   Don P. Duffy
                                                   Executive Vice President and
                                                   Principal Financial Officer

Date: August 14, 2001


                                       27

<PAGE>   28

                                 EXHIBIT INDEX

     EXHIBIT
     NUMBER                             EXHIBIT TITLE
     -------                            -------------
     10.109     Daybreak-The Big Picture Master License Agreement

     10.110     SuperSolutions Corporation Daybreak-The Big Picture Service
                Level Agreement

     21.1       Subsidiaries of the Registrant.




                                       28