Americans are buying more six-figure cars than ever before

Vehicle affordability is relative, but many consumers agree—new cars are still very expensive.

The average transaction price last month was $48,039, an increase of 1% year-over-year, but down 1.3% from January, per Cox Automotive. That's an increase of $10,890 from the beginning of 2019.

But inflation isn't entirely to blame.

Why it matters: Americans are also paying more for new cars because many automakers have prioritized selling expensive trucks and SUVs. And when buyers opt in—the average transaction price climbs—even if individual vehicle prices stay the same.

By the numbers: According to the latest Kelley Blue Book data—by the end of February (year-to-date), more than 52,000 new vehicles transacted above $100,000. That's a 333% increase from the same period in 2020.

Flashback: During the COVID-19 pandemic, automakers were upended. Factories shut down, supply chains were choked, and the semiconductor chip shortage hit like a wrecking ball.

• Fewer cars meant supply couldn’t keep up with demand, and basic economics kicked in—prices soared.

• So—automakers decided to focus on higher-end models with bigger margins, which were more profitable when supply was tight.

• And a growing share of consumers prefer these upmarket vehicles.

Yes, but compact SUVs remained the top-selling segment, accounting for 18% of all new car sales last month, with an average transaction price of $36,198.

Between the lines: Tariff uncertainty is hanging over the auto industry. 

• Steel and aluminum tariffs are already in play, and the delayed Canada and Mexico tariffs, set for April 2, add another layer of risk to future vehicle pricing.

• And manufacturers are likely hedging against a more expensive future by pricing vehicles with a long-term outlook in mind.

Bottom line: Automakers trained consumers to expect higher prices by prioritizing big-ticket vehicles, and many buyers are willingly playing along. Now—even as supply normalizes—affordability remains a moving target for most.

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