A surge in subprime auto loan delinquencies, high-interest burdens and rising car ownership costs are pushing America's auto credit system toward a breaking point, with recent bankruptcies exposing deeper cracks in the financial underpinnings of this $1.56 trillion market.

Auto Loan Delinquencies Spike: The Cracks Are Visible

It's getting harder to ignore what's happening under the hood of America's auto credit system.

More than 6% of subprime auto loans were over 60 days delinquent in August 2025, according to Fitch Ratings. That's the highest level ever recorded, and it's a clear sign that many borrowers, often those with lower credit scores and limited financial buffers, are falling behind.

VantageScore's August CreditGauge report adds more troubling data. Delinquencies are up across all credit tiers, even among superprime borrowers (scores 781-850), where 90-119 days past due increased by more than 300% year-over-year.

Though default levels remain low in absolute terms for these consumers, the shift signals stress creeping into previously resilient parts of the economy.

Car Costs Are Rising, And So Are ...