7 year finance damn! Seems that people did not learn from the crisis.
These aren't adjustable rate loans, nor on offer to subprime customers. Very different situation.
At 1.74% the rate is so low that even if you can't invest it or offset it higher (which you should easily be able to do), it's lower than expected inflation, so just time value of money would cause the longer period to be better.
Of course, if you can't afford the car at 5 year, and can only afford it at 7 year, it's a very different story, but you're not going to get a 1.74% rate if you're that close.
It'd be a different story if it was over 3.5%. If you have a mortgage @ over 4% you'd be better off paying that down than getting a shorter loan.
Just keep in mind mortgage interest is pre-tax.
So if you're at e.g. at 39% tax bracket, your car loan has to be at < 2.87% for it to be better to pay off the Mortgage instead.
But yes, the principle applies. If you have a 4% mortgage, you're better off taking a 7 year loan at 1.74% and putting additional money towards the mortgage or investments.