The sticker shock you experienced when checking the price of a new BMW or Mercedes-Benz sedan? You are not alone. Luxury cars are becoming substantially more expensive.
The average transaction price for a new vehicle hit $49,740 in December, a 1.3% year-over-year increase according to Kelley Blue Book. This marked the fourth consecutive month of rising car prices and approached the all-time high of $49,958 reached in December 2022. From 2020 to 2024, new-car prices across all segments jumped more than 20%, according to a January 2nd report released by Jerry, an app that allows consumers to compare car insurance options.
However, the most expensive vehicles have seen the most significant price increases. In the fourth quarter of 2024, a record-high 18.9% of consumers took out loans for new vehicles with monthly payments of at least $1,000, according to Edmunds, an auto industry data firm. Moreover, sales of cars costing at least $80,000 increased 37% in December compared to the previous year, according to Kelley Blue Book. Within this segment, the average price of a vehicle was $102,000.
