The Consumer Federation of America (CFA) released a report earlier this week titled “Driven to Default: The Economy-Wide Risks of Rising Auto Loan Delinquencies,” which argues that auto financing in the United States is at a critical point. The report claims that lenders and auto dealers are responsible for historic levels of consumer harm due to high loan payments and aggressive repossessions.
However, critics say these claims are not supported by data. They note that vehicles have become more expensive for several reasons, including technological advances such as electric and hybrid vehicles, as well as increased safety and fuel efficiency regulations. Supply chain disruptions over the past decade have also impacted vehicle availability and pricing.
While the CFA acknowledges that total auto debt now stands at $1.66 trillion—second only to mortgages—it describes this level as a crisis. Data from the Federal Reserve Bank of Philadelphia’s Consumer Credit Explorer shows average inflation-adjusted auto debt was $18,900 in the first quarter of 2025, which is only slightly higher than it was 20 years ago. The average debt burden remains consistent with levels from 2023 and 2024.
The CFA also points to rising delinquency rates as evidence of consumer distress. However, information from the Federal Reserve Bank of New York’s Household Debt and Credit Report indicates otherwise. In the second quarter of 2025, 5 percent of auto loan balances were severely delinquent—a figure unchanged from the previous quarter and lower than before the pandemic in 2020. Furthermore, only 2.93 percent of balances transitioned into serious delinquency during this period, marking the second consecutive quarterly decline. Early-stage delinquencies have also decreased for three straight quarters, falling to 7.9 percent in Q2 2025.
The CFA uses consumer complaints submitted to the Consumer Financial Protection Bureau (CFPB) as further evidence of problematic lending practices. Critics argue that these complaint figures are unreliable since submissions are not verified for accuracy or relevance; there is no process ensuring complaints are genuine or relate directly to financial products offered by named companies.
“Access to a vehicle is a critical component of economic success for American consumers,” according to CFA’s own statement within its report.
Critics conclude that both CFA and USA Today did not provide an accurate portrayal of current trends in auto finance and suggest their narrative does not help improve consumer protection or education.