Brace yourself for some eye-opening news: the average price of a brand-new car has reached an all-time high! In December 2025, car buyers shelled out a whopping $50,326 on average, according to Cox Automotive. That's a 1.1% increase from the previous month and a 0.8% jump compared to the same period last year. And get this - the Manufacturer's Suggested Retail Price (MSRP) also hit a record high of $52,627! For the last eight months, the average MSRP has consistently stayed above the $50,000 mark.
But here's where it gets controversial... December is usually a month of strong sales for automakers, with heavy incentives to clear out older models and make way for new inventory. Yet, despite these incentives, the average transaction price remained high. Full-size pickup trucks played a significant role, with over 233,000 finding new owners last month - the best month for this segment in five years! These trucks alone carried an average price tag of $66,386.
And this is the part most people miss... luxury vehicles also had a stellar end to the year. Nearly 20% of new car buyers opted for high-end models. However, electric vehicle sales took a slight dip in 2025, falling by 2% compared to the previous year. Despite this, EV enthusiasts still purchased approximately 1.28 million vehicles, with dealer and manufacturer incentives stepping in to boost sales.
So, what does this mean for the future of the automotive industry? Motor1 raises an important question: can this unsustainable trend continue? With longer financing terms, consumers are taking on more debt to afford new vehicles. How much longer can prices keep rising before the system crumbles?
It's like a modern-day version of The Big Short, but with a twist - defaulted loans on incredibly pricey cars and trucks.
What are your thoughts on this? Share your opinions and predictions in the comments below!
Source: Cox Automotive
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