Nearly 20% of new cars now cost $1,000 a month, report shows

Car buyers should brace for higher prices in 2026, as tariffs, changes to fuel efficiency rules and falling interest rates continue to push vehicle costs upward, according to industry experts. Edmunds analyst Ivan Drury says buyers who last purchased before the pandemic may be shocked to find average new-car prices rising from the pre-COVID range of $38,000–$39,000 to roughly $49,000–$50,000 today. Experian data shows about 80% of new cars are financed, with nearly one-fifth now carrying monthly payments of $1,000 or more—driven by a 30% jump in prices and higher interest rates since 2019. Drury expects average prices to climb above $50,000 in December due to luxury sales before dipping slightly in January as dealers move 2025 models.