The average cost of a new vehicle in the United States has climbed to nearly $50,000, representing a 30% increase over the past six years and creating affordability challenges for consumers already grappling with broader inflationary pressures.

Consumer prices rose 3.3% in March compared to the previous year, the largest yearly increase since May 2024, according to Labor Department data released Friday. New car prices specifically jumped 12.6% from a year ago, with average monthly payments reaching $775 based on 10% down and a six-year loan term.

The rising costs have significantly reduced affordable vehicle options. The share of vehicles listing for less than $30,000 has dropped to about 13%, down from 40% five years ago, according to car review site CarGurus. This has pushed consumers toward longer loan terms, with more than 12% now choosing seven-year loans compared to nearly 8% a year ago, resulting in higher total interest costs.

Automakers have contributed to price increases by shifting production toward larger, more profitable SUVs and pickup trucks while phasing out smaller, cheaper sedans. Advanced safety technology requirements and supply chain disruptions have also added to vehicle costs. The share of new car buyers earning below $100,000 fell to 37% last year from 50% in 2020.

The used car market offers limited relief, with the average used vehicle selling for about $25,000 in February and monthly payments averaging $560. The inventory of affordable used cars has declined as consumers keep their vehicles longer—nearly 13 years on average compared to 11.5 years a decade ago—and fewer lease returns enter the market.

Americans are responding by reducing spending in other areas, cutting back on groceries, rideshares, and other discretionary purchases as their incomes struggle to keep pace with rising prices across housing, food, utilities, and transportation costs.