Explore how soaring US car prices are squeezing middle‑income buyers and what it means for your next purchase. Read more now!
Recent data from Cox Automotive reveals a stark shift in America’s auto market: buyers earning less than $100,000 are rapidly disappearing from new‑car showrooms, while high‑income shoppers are snapping up the latest models.
Middle‑Income Buyers Lose Ground
In 2020, households earning under $100k accounted for about 50% of new‑car purchases. By the end of 2025 that share had fallen to just 37%. The drop mirrors a broader affordability crunch as the average transaction price for a brand‑new vehicle topped $50,000 for the first time.
Luxury and High‑End Buyers on the Rise
Conversely, consumers with incomes above $200k increased their buying share from 18% to 29% over the same period. Premium SUVs, luxury pickups and high‑margin electric models are driving this surge, prompting manufacturers to lean heavily into the affluent segment.
Monthly Payments Hit Record Levels
Financing a new car now costs an average of $750 per month. Even more striking, 20% of new‑car purchasers are paying $1,000 or more each month when taxes, fees and loan interest are factored in – a payment level traditionally reserved for mortgage borrowers.
The Used‑Car Market Isn’t a Safe Haven
Pressure isn’t limited to new vehicles. The median price for a used car has risen to **$26,000**, squeezing budget‑conscious shoppers. Listings for affordable used cars under $20,000 have dwindled dramatically, representing only 12% of all ads compared with nearly 50% in 2019**.
Manufacturers Shifting Focus
Industry analysts say automakers are effectively “abandoning” the middle class. By discontinuing low‑priced models and reallocating resources to upscale SUVs, trucks and premium electric vehicles, they are widening the gap between what the average consumer can afford and what’s on the lot.
What This Means for You
If you fall into the middle‑income bracket, the path to owning a new or even a reliable used car is becoming steeper. Exploring certified‑pre‑owned options, negotiating lease terms, or waiting for manufacturers to rebalance their line‑ups may be the only ways to keep car ownership within reach.
Stay informed, compare financing offers, and consider all vehicle categories before making your next purchase.