Rising US car prices have pushed the average new‑car cost above $50,000, leaving households earning under $100K struggling to afford a vehicle. Learn the impact and what’s next. Read more now.
New research from Cox Automotive reveals a stark shift in America’s auto market: the once‑achievable dream of owning a brand‑new vehicle is slipping away for anyone making less than $100,000 a year.
Soaring Prices Close the Gap for Middle‑Income Buyers
At the end of 2025 the average transaction price for a new car topped $50,000. That benchmark is more than double the price many middle‑class families can comfortably finance.
Consequently, shoppers earning under $100,000 now represent just 37% of new‑car purchasers, down sharply from 50% in 2020. In contrast, high‑income buyers (those earning over $200,000) have surged from 18% to 29% of the market in the same period.
Monthly Payments Hit Record Levels
Financing a new vehicle has become equally burdensome. The average monthly payment for a financed car has climbed to nearly $750. Even more striking, one‑fifth of new‑car owners are now paying $1,000 or more per month once taxes, fees and interest are factored in – a payment size traditionally reserved for mortgage loans.
The Ripple Effect on the Used‑Car Segment
Higher prices are not confined to brand‑new models. The average listed price for a used car now sits above $26,000. Affordable options under $20,000 have nearly vanished, comprising only 12% of online listings compared with almost 50% back in 2019. This squeeze leaves budget‑conscious shoppers with very few viable choices.
Manufacturers Are Shifting Focus
Industry analysts say automakers are “dropping the middle class” by concentrating resources on high‑margin segments such as premium SUVs, luxury pickup trucks, and costly electric vehicles. As low‑priced models are phased out, the market increasingly caters to affluent buyers who can absorb higher price tags and generate greater profit per vehicle.
What This Means for the Average American
The combined effect of soaring sticker prices, record‑high monthly payments, and a shrinking pool of affordable used cars is turning car ownership into a luxury for many. For families earning below $100,000, the path to a new vehicle now often requires larger down payments, longer loan terms, or a shift toward older, higher‑mileage cars.
Stakeholders—from policymakers to manufacturers—face a critical question: how to restore realistic pathways to mobility for the broad middle‑class base that has traditionally powered America’s auto market.