Kelley Blue Book (div. Cox Automotive) reports the average transaction price for a U.S.-sold new vehicle has exceeded the $50,000 mark for the first time, ending September at $50,080 despite increased incentive spending that offset prices by an average of $3,700, or 7.4% of ATP.

Analysts blame a run on EVs leading up to the Sept. 30 expiration of a $7,500 federal tax credit that also applied to some hybrids. Electrified vehicles accounted for a record-high 11.6% of new vehicle purchases in September with a $58,124 ATP.

Other factors include tariffs on imported vehicles, a “rich mix” of premium vehicles and the rollout of 2026 models.

“It is important to remember that the new-vehicle market is inflationary. Prices go up over time, and today’s market is certainly reminding us of that,” KBB Executive Analyst Erin Keating writes in a release. “The $20,000 vehicle is now mostly extinct, and many price-conscious buyers are sidelined or cruising in the used-vehicle market. Today’s auto market is being driven by wealthier households who have access to capital [and] good loan rates and are propping up the higher end of the market.”

Affordability issues have become increasingly apparent with the ongoing release of September and Q3 auto finance reports. Last week, Edmunds’s Ivan Drury wrote that September’s record average of $6,905 owed on upside-down car loans in September should serve as a “wake-up call” for the industry.

Read more at Kelley Blue Book