On the Dash: Dealers face affordability crunch as entry-level vehicles disappear
- Affordability concerns rise as new-vehicle prices have increased by more than $11,000 since 2019.
- Budget cars are nearly gone, with subcompacts like the Nissan Versa now largely discontinued.
- More buyers are stretching into 84-month loans, pushing dealers to lean harder on F&I.
Anyone who has shopped for a new car recently knows the pain of sticker shock. According to Edmunds data, the average transaction price (ATP) for a new vehicle reached $48,402 in 2025. In 2019, that number was $37,310. That’s a jump of more than $11,000, or 30%. The increase roughly mirrors broader inflation over the same span, but the loss of entry-level models and higher interest rates have squeezed budget buyers hardest.
The budget end of the market has nearly disappeared. In 2025, just 0.2% of new vehicles sold for $20,000 or less, a 5.5% drop from 2019. Additionally, only 4.7% of vehicles were sold for $25,000 or under, compared to nearly 21% six years prior.
Vehicles under $30,000 now account for only 15% of sales, which is down from 40%. Subcompacts were the last foothold for budget buyers, as most have now been discontinued, including the Mitsubishi Mirage, Nissan Versa, Honda Fit and Toyota Yaris.
According to Edmunds, the top of the market moved the other way, with large SUVs selling above $60,000, climbing from nearly 59% in 2019 to 95% in 2025. Among full-size trucks, just 8% sold above $60,000 in 2019. Today, nearly half do.
To keep monthly payments manageable, more buyers are taking longer loans. Loans of 84 months or longer made up 22.9% of financed new-car purchases in Q1 2026, an all-time high according to Edmunds.
For dealers, the crunch reshapes every deal. Buyers either stretch into longer loans, move to used, or exit the market, which pressures front-end margins and leans harder on F&I and fixed ops. Automakers still face the question they have avoided for years: whether to bring back affordable models or cede entry-level buyers entirely.
