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Report: New Cars Are More Expensive Than Ever, As Used Car Prices Keep Dropping



New cars at reasonable prices are like unicorns in the U.S. these days, as carmakers seem intent on implementing a fully luxury market. Perhaps it’s now time to consider the used car market, where prices are falling consistently from pandemic highs. Read on to understand the woes of new car shoppers — and the opportunity facing the used car market.

New cars are pricier than ever

According to a new report by Cox Auto Group (opens in new tab), the U.S. new car market is becoming a luxury market, where new vehicles are available only for wealthier buyers. The dramatic shift can be pegged to supply disruptions, new tech, limited inventories, higher interest rates, and automakers increasingly focused on wealthy buyers. 

Cox Auto measured the new car market shift between December 2017 and December 2022. The study focused on more affordable vehicles priced under $25,000 alongside vehicles priced over $60,000, which is generally out of the average American buyer’s price range.

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(Image credit: Cox Automotive)

In December 2017, Cox measured 36 models with MSRPs below $25,000. Then, under-$25K cars were 13% of total new-vehicle sales, with 204,593 sold. By December 2022, only 10 models with MSRPs under $25K remained on the market, with 43,557 sold — a share of just under 4%.

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