New Car Prices Are Soaring. Here’s How To Get the Car You Want—and the Best New Cars To Shop
It’s pretty shocking: the average price of a new car is $52,000. All is not lost, however.
Yes, you heard it right: The average price of a new car has ticked up to $52,000. That’s an average, and yes, price creep is real; this number represents a 35% increase in the last decade. If you’re making 35% more, then it seems reasonable. If you’re paying $4 a gallon for milk, you’re paying the same as you did in 2016 (adjusted for inflation) making the price jump feel untenable.
As a bit of an explainer, cars have gotten much more sophisticated—hello emergency braking, voice assistance, better fuel economy and Apple CarPlay. Also, that price increase reflects higher new car prices for luxury cars, which have only gotten more luxurious in the last decade.
This story is 100% human-researched and written based on actual first-person knowledge, extensive experience and expertise on the subject of cars and trucks.
Are New Car Prices Really Higher? A Closer Look
But even affordable cars have gone up quite a bit; the Honda Civic, which had a starting price of about $20,000 in 2016 now starts at $25,000. That’s a 25% increase, but also, it’s larger and better outfitted now than it was then. Such is progress.
If you find that new car prices are squeezing your budget and your patience, read on. There are workarounds and preparations to ensure you get the right car at the price you can afford.
First and Most Importantly: Get Your Credit and Financing in Shape
Any new car will be more expensive if your credit isn’t purchase-ready. That means looking at your credit report and contesting anything that isn’t accurate, paying down credit cards or other debts that are holding your credit down, and negotiating with any creditors who are still reporting issues. A few calls and emails can raise your credit rating quite a bit.
Our best pick for credit-crunched buyers: VW Jetta
Make a List of Needs and Wants
Next, start your wish list by making a list of needs and wants: The number of seats you need, all wheel drive (or not), leather seats (or not), a panoramic sunroof, Apple CarPlay, voice assistance. Once you have the list of things you need and you can separate out the nice-to-haves, start your shopping!
Our pick for the best-priced have-it-all SUV: Kia Sorento
Shop Early and Often
Start your shopping now. Download the shopping apps—KBB, AutoTrader, CarGurus—create an account, set up your profile and vehicle preferences and start looking at cars. You can customize your search based on your need-to-have and nice-to-have lists and really see the differences between different car makers and different models. Pin or save your favorites and think about each for a bit before going to a dealership for a test drive.
Our pick for easiest to shop SUV: Hyundai Tucson
Compare Financing and Get Pre-Approved for a Loan
This is where it gets real: building out your purchase. You’ll need to assess the value of your trade-in, which you should do separately from your purchase; you’ll need to decide how much to put down in addition to a trade-in, if any; you’ll need to understand how much your new car’s insurance will cost and the length of your payment plan.
Download a car loan calculator or use an app like Capital One Auto Navigator and look at your new car price and payment as you adjust the settings. We like that Capital One Auto Navigator, once you’re approved for a loan, shows cars for sale and allows you to set parameters and see payments based those actual cars.
Our pick for best finance deals right now: Mazda CX-5
Understand the Total Cost of Ownership Of a New Car
Once you get your new car home, what will it cost to operate? Gas or electricity, of course, but also, new tires, oil changes and other maintenance; insurance, parking, tolls and other charges will add to your total cost of ownership. Understanding all these factors for every car you consider buying will help put the financial commitment into better focus.
Our pick for low cost of ownership: Hyundai Ioniq 5
Look at Dealer Trust Ratings
Read the ratings and comments on Google, Yelp and ask around on Facebook or X. Don’t look at paid or dealer-generated ratings like those on DealerRater. And look out for overly complimentary comments; those are often phony and coerced, from “give me a good rating so I don’t get fired” to friends and family pumping up a dealership’s positive comments. Don’t believe all the angry complaints either, unless they are overwhelming.
Our pick for best dealership experience: Lexus RX350
Negotiation Means Sorting Out the Details and Asking Questions
Once you’ve decided on the cars you’d like to test drive and the dealerships you’d like to visit, it’s time to line up your test drives. Once you take a test drive the sales person will probably start to craft an offer. Take it all in, then get a written offer and take it home. Search the internet for thorough explanations of any terms or details that are not plainly clear. Understand every detail and ask the inter webs if each item is usual and fair. They may not be.
Once you understand the full offer, it’s time to decide: is this the car, and the deal, for you?
Our pick for easiest negotiation: Rivian R2
Don’t Be Afraid to Walk Away
A lot of car buyers go into a new car purchase feeling confused and overwhelmed and just want to get it over with. That is exactly where many salespeople want you to be; you’re most likely to sign and drive, and less likely to try to negotiate. If you find yourself feeling this way, it’s time to leave that dealership. You may need to go to plan B, or start your dealership search over again, but it’s worth it to get the right car at the right price and to be treated with respect, don’t you think?
Our pick for no-haggle car buying: Tesla
Consider Buying Your Car at Costco
You won’t necessarily spend less but you’ll Costco Auto offers a fair deal, more interior features and a Costco gift card for your efforts. Costco offers virtually every model and trim and has ongoing specials on certain models that change every couple of months; those are often the best deals because they offer a higher-level trim at a mid-trim price, and also, offer a very nice gift card with purchase.
Our pick for Costco Autos right now: VW Atlas, Chrysler Pacifica and Chevy Bolt
Consider a Used Car and Follow Used Car Buying Rules
Comparing a used car to a new one is a tough exercise because there are so many variables, and, used cars come with a lot of caveats and an amount of risk. But a diligent search can turn up a great car at a great deal—if you do your due diligence. That means researching values, vetting a car’s CarFax, having it inspected and understanding what it might need in the short run such as new tires or scheduled maintenance. If you can get it from someplace like CarMax that offers a short warranty, all the better.
If you’re considering a certified pre-owned car, or CPO, carefully compare it to a new version of the same model; you may or may not see much advantage in the CPO.
Our pick for best used car: Toyota RAV4
Once you’ve prepared, researched and done the hard work, your new car will seem like a reward, which is what it should be. No matter the price.
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