- Average new car price passes $50,000 as luxury sales surge nationwide.
- Mid-market buyers retreat, banks stretch loans longer to keep deals alive.
- Car market splits into haves and have nots with widening affordability gap.
Walk into a luxury car dealership full of shiny SUVs and six-figure trucks, and you might think the US car market was on fire right now. But you’d only be partly right. Because in more mainstream showrooms you could find a different mood with cautious shoppers, longer conversations about monthly payments and a lot more people deciding to wait.
Luxury for Some, Out of Reach for Others
The result is a strange new reality where the car market is booming and struggling at the same time. On one end of the spectrum, buyers with money are spending freely.
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They’re buying big, expensive vehicles loaded with tech and comfort, and they are doing it in record numbers. On the other end, lower and middle income Americans are being quietly priced out of new cars altogether.
The tipping point might well be psychological as much as it is financial. Once the average price of a new car crossed the $50,000 mark, which it did last year, the idea of a new car probably stopped feeling quite so normal, and started feeling like a luxury in itself.
The Top Keeps Rising
According to USA Today, some luxury dealers are having their best years ever, even as the wider market softens. One dealer told the paper that demand at the high end remains strong, driven by what he called “enthusiast purchases” and a love for the latest and greatest.
Nelson Andrews, who runs Andrews Transportation Group, a company that owns four luxury dealerships in Middle Tennessee including Cadillac, Jaguar, and Range Rover, told the outlet that 2025 is shaping up to be a milestone. “We’re going to have our best year ever this year,” he said.
Kelley Blue Book data backs that up. Vehicles priced above $75,000 now sell in higher volumes than those below $30,000 dollars. Affordable cars still exist, but they are no longer what most buyers are choosing. Only 7 percent of new cars sold in the US in November cost less than $30k, we reported recently.
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KBB also reports that the average transaction price for a new vehicle rose to $50,326 in December 2025. That’s a 0.8 percent increase from last year and a 1.1 percent jump from November.
Squeezed Middle
For many ordinary Americans, the numbers are getting harder to justify. Higher interest rates, bigger loan balances and longer finance terms mean more buyers are either stretching themselves thin or stepping away entirely.
Banks are now offering loans as long as 84 months, which would have sounded absurd not that long ago. It keeps monthly payments lower, avoiding the $1,000 bills one in five buyers now face, but can also leave buyers upside down for years. Not that your average luxury car buyer needs to worry about that.
