U.S. consumers are responding to surging prices for new cars and trucks by going deeper into debt, pushing the average new vehicle loan to a record-high $40,290 during the second quarter, credit monitoring company Experian said Thursday.
The average monthly payment for a new vehicle loan rose to $667 in the second quarter, up nearly 15% from a year earlier, Experian said in its latest report on the automotive finance market. The average amount borrowed rose 13.2%, Experian said.
The length of the average new vehicle loan stayed flat in the second quarter compared to a year ago at just over 69 months.
Used car buyers also are borrowing more. The average used vehicle loan jumped 18.7% to $28,534, with an average monthly payment of $515, up 17%.
Despite the Federal Reserve’s efforts to cool the economy by raising interest rates, prices of new vehicles in the United States have been rising faster than overall inflation rate for much of the year. Automakers say they still cannot keep pace with demand because of shortages of semiconductors and other supply chain snarls.
The price of the average new car or truck hit a record $46,259 in August, market research firm J.D. Power said this week.
Experian said loan data show that more consumers are opting for a used car or truck as new vehicle prices rise. Used vehicles accounted for 61.8% of all vehicle loans during the second quarter, up from 58.5% a year earlier.
Of vehicles financed in the second quarter, 60% were sport utility vehicles, Experian said.