The price of that new car, truck or — most likely — SUV you’ve been looking at rose a bit in September. And while it’s easy to look at the window sticker to see how much, there’s another way that hits home: how long will it take you to buy it. Well, last month it took a little more time.
A new affordability measure shows Americans need to work longer each year to afford a new car.
According to analysts at Cox Automotive, Americans paid more on average last month than ever to buy a new vehicle: $50,080. That is the average transaction price, which is what a new car costs the buyer after factoring in things like price, incentives, etc.
“Higher incentives and income growth weren’t enough to offset September’s new-vehicle price increase,” said Cox Automotive Chief Economist Jonathan Smoke. “Even though incentive spending was at its highest level this year, the average transaction price for a new vehicle reached a record $50,080.”
However, there are other ways of figuring out what Americans are paying for a new vehicle and how it’s impacting their lives. Cox covers that too, fortunately with the Cox Automotive/Moody’s Analytics Vehicle Affordability Index. New cars had been getting more affordable through much of 2025, but that changed in September and it’s likely to keep changing … and not for the better.
Needing more time
Higher average transaction prices pushed the affordability index upward for the first time in months.
The index measures how many weeks it takes to buy a new vehicle using median income. In short, how long would it take the average buyer to earn the money needed to buy a new vehicle. And that rose to 37.4 weeks in September from 36.8 weeks in August.
New-vehicle affordability in September improved by 2% compared to a year ago, when it took 38.2 weeks of median income to purchase the average new vehicle. A year ago, prices were 3.7% lower, but interest rates were higher. Incomes and incentives were also lower in September 2024, Cox officials note.
For the record, that’s nowhere near the, uh, record number. The high-water mark was just over 42 weeks in late 2022. But the fact that it’s on the rise, isn’t a good sign for consumers.
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Another measurement
The average new car payment rose 1.9% in September to $766.
If the whole affordability index thing is a bit esoteric, you can simply note that the average new car payment rose 1.9% in September to $766 — the highest it’s been in 15 months. It’s also 1.2% more than September 2024. While those numbers are high, they are also not near the record of $795 a month, which we “achieved” in December 2022.
There are a few reasons for the rise. Americans rushed to dealerships to gobble up electric vehicles in record numbers, looking to beat the clock on the end of the $7,500 federal tax credit for EVs. Battery-electric vehicles are more expensive than their gas-powered equivalents, which pushed prices upward.
Additionally, Americans appear to want nicer vehicles these days. Luxury vehicle sales have been on the rise during the past few months, and they’re also pricier than their mainstream counterparts. The shock of high interest rates is being offset by lenders offering longer-term loans, as long as 84 months in some instances.
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