Auto Loan Market Forecast to Exceed $2.8 Trillion
A new report from Mordor Intelligence projects the global auto loan market will surpass $2.8 trillion by 2031. The growth is driven by strong demand for passenger vehicles, which accounted for over 80% of financing in 2025. The expansion is also supported by the rise of digital lending platforms and momentum in used-vehicle financing.
The U.S. auto loan market is substantial, reaching $1.655 trillion in total debt by the third quarter of 2025. This form of debt is the second-largest category for American consumers, following only mortgages. In the third quarter of 2025 alone, Americans took on $183.9 billion in new auto loans. Rising vehicle prices are a key factor, pushing the average loan amount for a new car to $42,332 and $27,128 for a used one as of late 2025. This has driven average monthly payments to near-record highs, hitting $748 for new vehicles and $532 for used vehicles in the same period. For professionals in Woonsocket, it's notable that Rhode Island has one of the lowest average monthly auto loan payments in the nation at $549. The average auto loan debt in the state was $19,597 as of April 2025, reflecting a 3.7% increase from the previous year. Concerns about loan affordability are growing, with 90-day delinquency rates reaching 5.0% in the third quarter of 2025, a 9.4% increase from the prior year. Some analysts note that overall 60+ day delinquency rates have surpassed the peaks seen during the Great Recession. The market is dominated by banks, which hold the majority of lending for new vehicles, and captive finance companies—owned by automakers like Toyota and Ford—which lead in the used vehicle segment. Key players include Ally Financial, Bank of America, and Toyota Financial Services. Looking ahead, the industry is seeing a significant shift toward digitalization, with fintech lenders projected to experience the highest growth rate through 2031. There is also a growing trend in financing for electric vehicles (EVs) and an increase in loan terms extending to 84 months or longer.
