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Americans Are Paying More Than Ever For Cars And There's Really No End in Sight
- Due to disruptions in global supply chains during the COVID pandemic, car prices have skyrocketed, leading to paying over MSRP becoming common.
- New car average transaction prices are around $10,000 higher than pre-pandemic levels, with Ford's average transaction price soaring to $54,082.
- Used car prices also saw a significant increase by 32% compared to 2019, with consistent rate increases contributing to high payments.
- Interest rates for auto loans have been rising, with rates in some areas reaching as high as 8.78% for new cars and well into double digits for used cars.
- Despite high prices indicating a potential slowdown, data shows an increasing demand for expensive vehicles priced at $100,000 or more.
- The imposition of tariffs and economic uncertainty may further impact car sales in 2025, potentially making vehicles even more expensive.
- Consumers are facing affordability challenges, leading to overextending on car payments, with car repossessions reaching levels not seen since 2009.
- With prices continuing to rise and potential economic challenges ahead, the future of the automotive industry remains uncertain.
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