Auto loans remain the second-largest debt category for American consumers, behind mortgages. Now, more people are falling behind on their car payments, with total auto loan debt reaching more than $1.6 trillion nationwide.

"The timing of these red flags right now is, I think is especially alarming given sort of the larger trends in the market around the affordability of cars," said Tara Mikkilineni, senior fellow at the Consumer Federation of America.

The organization released a report highlighting the trend and its potential impact on the economy. Mikkilineni said car prices are higher, and costs for insurance and repairs are up in part due to tariffs.

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"All of these things have sort of combined to cr

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