New cars are less affordable than ever before. That’s true not just in terms of the cash we pay to buy them. It’s also true of the time we spend working to pay them off.
The Cox Automotive/Moody’s Analytics Vehicle Affordability Index tracks the number of weeks of income the average earner needs to buy the average new vehicle. At the end of 2021, it set a depressing record – 43.2 weeks.
Cox Automotive is the parent company of Kelley Blue Book.
Nearly every factor that feeds into the index moved against buyers in December. Median income stayed static. The price paid moved higher to a new record average price of $47,077. Incentives declined to at least a 20-year low.
Related: 10 Insider Tips for New Car Buying
The estimated typical monthly payment increased to a new record high at $688, which was up 19.7% year-over-year.
Most experts expect new car prices to continue to rise through much of 2022. They won’t begin to normalize until a worldwide microchip shortage eases, which may not happen until late this year
