NEW YORK — While tax rebates appeared to help consumers with paying down their debts, going forward, consumers will struggle with their bills and Fitch Ratings said it sees subprime auto losses climbing even more into the summer.

More specifically, the company indicated that its 60-day plus delinquency index came in at 3.28 percent in June, up from 3.06 percent in May.

"This is slightly improved from the beginning of 2008 when the index hit a seven-year high of 4.03 percent," officials explained.

In fact, delinquencies came in 34 percent higher in June over the prior year, Fitch reported.

Subprime annualized net losses climbed month-over-month to 5.63 percent in June from 5.47 percent in May.

"The level in June 2008 was 44 percent higher than in 2007, but still well below the same period in 2002 to 2004, similar to the pattern illustrated by prime ANL," executives said.

More specifically, officials noted that, "Tax rebates seem to have aided consumers in paying down their debts in the past couple of months. However, there is little present in the current environment that will aid delinquencies and losses in the near future.

"Consumers are facing difficult economic conditions including a weak labor market, high energy prices and inflation, declining home values and rising debt levels," they continued. "Fitch expects to see subprime losses increase during the remainder of the summer as we enter a seasonally softer period as demonstrated by loss patterns in prior years."

On the prime side, the company reported that its delinquency and ANL indices showed some seasonal improvement during the second quarter, with performance remaining above recent trends.

The delinquency index of 60-plus day came in at 0.62 percent in June, up 8.8 percent from May. Officials noted that the June level came in almost 30 percent higher compared to the same period last year.

"Despite this elevated loss rate, ANL are consistent with the range of losses produced in 2003 and 2004," officials explained.

Moving on, Fitch said that seasonally adjusted cumulative net losses reached 0.78 percent, up from 0.76 percent in May. This is 35 percent higher than 2007. However, it remains below 2003 and 2004 levels, and consistent with 1999 loss rates.

"Moving into the second half of 2008, performance has historically remained weak through the third quarter and is unlikely to show improvement in the coming months given the current macroeconomic climate and softening wholesale vehicle values," executives pointed out.

They went on to say, "Prime auto ABS asset performance has declined significantly in 2008 coming off of the record lows produced in the past two years. However, performance levels remain within range of 2003 and 2004.

"Furthermore, ratings actions remain stable in the prime sector in 2008, with little rating volatility present and upgrades continuing to occur by Fitch, although at a slower pace than in 2007," officials added.

As for auto issuance, which includes auto loan, lease, rental, floor plan, truck and motorcycle, the company reported that this hit $33.53 billion through June, which is 25 percent below the same level in 2007.

Overall, 28 transactions reached the market, which officials said is "down significantly" from 45 at the same time last year.

"Issuance jumped in the second quarter of 2008 versus the first quarter by 78 percent," the company said. "Eighty-three percent of total issuance has come from prime auto loans, followed by non-prime/subprime with 11 percent, lease/rental with 5 percent and motorcycles with 2 percent.

"The most active issuers in the market are the Big 3 U.S. manufacturers with a 48-percent market share led by Ford Motor Credit Co," Fitch indicated.

Officials went on to report that:

—Huntington Bank issued a $975 million deal.

—Nissan entered the market for the second time this year with a $1.25 billion deal.

—Wachovia securitized a $1.1 billion transaction.

—Honda sold $1.5 billion worth of notes.

—Hyundai sold $613 million of auto ABS.

—AmeriCredit issued its first deal for 2008 through its 2008-A-F trust totaling $750 million guaranteed by FSA.

—Franklin Auto Trust 2008-A issued in June was only the fifth subprime deal issued this year, totaling $484 million.