New-Car Prices Rising, But for Much Different Reasons
Product affordability has become a big auto industry issue, but what’s causing the steady rise in new-car transaction prices?
Part of it is that automakers are putting more advanced technology systems into their vehicles, making some of them semi-autonomous in their ability to do things such as automatically brake and maintain lanes to avoid collisions.
“We need to make sure new vehicles, especially with all the new technology and safety features that are being added to them, remain affordable for all of our customers,” Charlie Gilchrist, 2019 chairman of the National Automobile Dealers Assn., tells Wards in an interview. “The affordability issue really permeates everything we do.”
The average lease payment now stands at $494 a month and the average monthly loan at $566, says Charlie Chesbrough, Cox Automotive’s senior economist. The prospects of paying that 12 times a year sends many budget-minded consumers to the used-car lot.
“Affordability is a big issue,” he says.
Source: Cox Automotive