Why New Car Prices Keep Climbing (And What to Do)

New cars are averaging astir $50,000—and that affordability spread is getting harder to manage. Automobile enthusiast Ray McGrath breaks down wherefore prices support climbing, what "value" truly means beyond the monthly payment, and however to deliberation done the large decision: bargain vs. lease.

Jeffrey Snyder, Broadcast Retirement Network

This greeting we're talking conveyance affordability and helping maine interruption it each down. He is an automobile enthusiast, Ray McGrath.

Ray, ever large to spot you. Thanks for joining america connected the programme this morning.

Ray McGrath, Automobile Enthusiast

Oh, convey you for having maine arsenic always, Jeff.

Jeffrey Snyder, Broadcast Retirement Network

So, you know, we person continued to speech astir this for the past respective years with you and others. Cox Automotive conscionable enactment retired a caller survey. The mean caller car, Ray, is $50,000.

That's a inclination heading successful the incorrect direction.

Ray McGrath, Automobile Enthusiast

Well, I mean, arsenic we're each good aware, ostentation is thing that I deliberation for galore years we didn't acquisition to the levels that we're seeing today. I mean, and it's not conscionable today, it's been implicit the past 7 years, beauteous overmuch since the pandemic, everything is up 25% oregon more, just, you know, pre to 2020.

Jeffrey Snyder, Broadcast Retirement Network

So let's speech astir the why. Is it due to the fact that consumers are buying cars with much features truthful radical are living, truthful is it that radical are surviving supra their means? Is that the crushed wherefore the mean car prices proceed to tick up?

Ray McGrath, Automobile Enthusiast

I don't deliberation it's that, though it appears to be, you could accidental similar that. I deliberation truly cars are a large purchase, you know, speech from possibly buying a house. And if you're going to walk each this money, I mean, bash you privation a car with roll-up windows and nary aerial conditioning?

So you benignant of privation each the latest features if possible. You know, immoderate cars, definite colors are optional. So, I mean, I deliberation it's an aspirational acquisition for sure.

And evidently you're going to beryllium paying for it implicit a longer play of time. But, you know, I deliberation folks privation what they want. And yeah, I conjecture you could accidental they're surviving beyond their means, but, you know, it's not similar buying, you know, a gallon of beverage oregon thing similar that.

Jeffrey Snyder, Broadcast Retirement Network

So it's not commoditized, but however bash you find worth successful the caller car market? I mean, surely you tin find worth successful a utilized vehicle. You tin look astatine mileage.

You tin look astatine the terms of the car. You tin look astatine the brand. You tin spell to organizations similar CarMax.