U.S. New Car Prices Hit $51,974, Up 65.5% Since 1970 as Trucks and SUVs Dominate

Q: Is America's obsession with large vehicles driving households into an inescapable financial trap?

Yes—America’s preference for larger, pricier vehicles is pushing many households into a costly debt cycle, though it is not inescapable for buyers who choose smaller cars or used vehicles. The core problem is affordability. The average new vehicle now costs about $51,974, equal to roughly 62% of the median U.S. household income, up from 42% in the mid-1970s. That jump is not mainly about general inflation. It reflects a market that has shifted away from sedans toward trucks, SUVs and crossovers, which now dominate sales and carry much higher prices. That shift is showing up in household finances. New-car buyers are borrowing more, with average new-vehicle loans near $44,000 and average monthly payments around $770. To make those payments look manageable, many buyers are stretching loans to six or seven years. That lowers the monthly bill but raises total interest, increases the chance of being underwater on a rapidly depreciating asset, and makes it harder to trade in or recover from a financial shock. Auto debt has climbed to about $1.685 trillion, and 90-day delinquency rates have reached a record 5.6%. Still, large vehicles are not the only cause. Higher rates, dealer markups, tariffs risk, added features, insurance, and post-pandemic supply pressures also matter. And the trap is avoidable for some: compact cars such as the Corolla and Civic average about $27,590, or roughly one-third of median income, much closer to the affordability Americans had decades ago.

1 articles · Updated · Jalopnik · Jul 10

$51,974 was the average U.S. new-car price last week, the first sustained move above $50,000 and 65.5% higher than 1970 in inflation-adjusted terms.
$83,730 in median household income now buys less car: the average sticker equals 62% of annual income, up from 42% in 1975.
Trucks and SUVs drove much of that gap as the market mix flipped from 60% cars and wagons in 1995 to just 31% by 2020, while larger vehicles also became pricier than sedans.
36.5% of buyers this spring took loans of 73 months or longer, and a record 23.9% signed seven-year loans, underscoring how higher prices are stretching affordability.
$27,590 compact cars remain a relative escape hatch: their prices rose just 1% from a year earlier, and a 20% down payment would be about $5,518.