The average price of a new car was $50,080 in September, marking the first time the going rate of a passenger vehicle has exceeded $50,000, according to a press release from Kelley Blue Book.
Erin Keating, an executive analyst at Cox Automotive, the world’s largest automotive services provider, said that the higher prices of new cars are being driven by low loan rates, tariffs and electric cars.
“Today’s auto market is being driven by wealthier households who have access to capital, good loan rates and are propping up the higher end of the market,” Keating said.
“Tariffs have introduced new cost pressure to the business, but the pricing story in September was mostly driven by the healthy mix of EVs and higher-end vehicles pushing the new-vehicle ATP into uncharted territory,” she added.
Car debt has also reached record levels, and a growing number of car owners owe more on their vehicles than they are worth, new data published on Wednesday shows.
More than one in four new vehicle owners owe more on their cars than they are worth and carry more than $10,000 in debt, according to a press release from Edmunds, an online car buying resource.
According to Carfax, a vehicle data, listings and valuation company, the value of a new car falls by around 20% in its first year and then 15% each subsequent year.
The average monthly car payment is $749, according to Experian, a major credit reporting bureau.