Car prices are still hovering near all-time highs, but one of the main reasons is that automakers are stacking their lineups with high-end vehicles.
As of August, the share of new cars sold over $50,000 was almost double what it was in 2019, according to Cox Automotive. There were about 33 models for sale with a manufacturer’s suggested retail price, or MSRP, above $100,000 and 18 below $30,000.
Wealthier customers have been boosted by rising house values, stock market returns and favorable credit, while lower- and middle-income buyers find themselves locked out.
“We either need a much more viable, lower cost alternative or something needs to happen in the financial markets that really loosens the ability for those buyers to purchase,” said Erin Keating, executive analyst at Cox Automotive.
Meanwhile, companies are growing ever more reliant on a smaller share of consumers for sales.
“If that bubble bursts, that has pretty dramatic implications across the economy,” said John Leer, chief economist at Morning Consult. “So many companies have become so focused on catering to the demand of those high-income consumers.”
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