The average price paid for a new vehicle in the United States surpassed $50,000 for the first time ever in September, marking a significant milestone in a nationwide struggle for affordability. According to a new report from Kelley Blue Book, the average transaction price (ATP) reached a record high of $50,080 in September.
This new peak represents a 2.1 percent increase from August and a 3.6 percent jump from September 2024. The year-over-year gain is the largest since the spring of 2023 and aligns with long-term inflation averages for new vehicles. At the same time, manufacturers’ suggested retail prices (MSRP) also hit a new record of $52,183 in September, up 4.2 percent year over year. Despite the record prices, the report notes that retail sales continue at a healthy pace, driven largely by affluent consumers.
“It is important to remember that the new-vehicle market is inflationary. Prices go up over time, and today’s market is certainly reminding us of that,” said Erin Keating, Executive Analyst for Cox Automotive. “Today’s auto market is being driven by wealthier households who have access to capital, good loan rates and are propping up the higher end of the market.”
Prices Haven’t Impacted Luxury Demand
The increase in ATP can, in part, be attributed to a mix of luxury vehicles and expensive electric vehicle (EV) models. In September, more than 60 different models had ATPs above $75,000, accounting for 7.4 percent of total industry sales, an increase from 6.0 percent in the same month last year.
Electric vehicle sales played a significant role in pushing the overall market ATP higher. A record 437,487 EVs were sold in the third quarter, driven by buyers rushing to finalize deals before federal tax credits expired at the end of the month. The EV market share hit a record high of 11.6 percent in September.
The average transaction price for an EV in September was $58,124, up 3.5 percent from a revised August figure but down 0.4 percent year-over-year. EV incentives remained substantial, averaging 15.3 percent of ATP, or nearly $8,900. Automakers increased incentive spending overall to its highest point in 2025, reaching 7.4 percent of ATP, or approximately $3,700 per vehicle. This is up slightly from 7.2 percent in August.
No Immediate End in Sight for High Costs
For potential buyers looking for any semblance of a deal, there is not much out there right now in the new vehicle market. There are not many cars left under $30,000 and if high-end customers maintain steady demand for vehicles at $50,000 and above, there’s not much reason to believe that will change.
The used market is where cost-conscious consumers are flocking to, with sub-$30,000 used vehicles seeing a 72 percent increase in sales year over year according to CarGurus. Still, even this market is quickly seeing a reduction in value as used-prices creep up and affordable stock gets older. About half of those sub-$30,000 vehicles were over seven years old and had, on average, 114,000 miles of wear and tear.
Both markets have been creeping towards even more elevated prices all year. With the introduction of 2026 model year vehicles, the price increases analysts have been predicting since March have finally come home to roost.
“Tariffs have introduced new cost pressure to the business, but the pricing story in September was mostly driven by the healthy mix of EVs and higher-end vehicles pushing the new-vehicle ATP into uncharted territory,” said Keating. “We’ve been expecting to break through the $50,000 barrier. It was only a matter of time, especially when you consider the best-selling vehicle in America is a pickup truck from Ford that routinely costs north of $65,000. That’s today’s market, and it is ripe for disruption.”
Related Stories: