Car Prices Are High, But Automakers Have A Plan That Might Help

As American cars continue to get bigger, wider, heavier, and more expensive, it's no wonder why drivers are wishing for a way to buy less car. With the average new vehicle going for around $50,000 in 2026, people don't want all the premium trims. They want entry-level models. (You can get a nice one for under $30,000.) And it's forcing automakers to rethink what they're building going forward.

Recent industry data shows base-model vehicles are selling faster than their more expensive counterparts, which is a reversal from years of sales that favored more expensive, feature-loaded trims. But that's becoming a thing of the past. As buyers face more expensive housing, insurance, healthcare, groceries, and now gas prices soaring, the more affordable option is looking a lot better than the luxury alternative. Now, entry-level versions of popular models are gaining traction across the board.

From compact sedans to pickup trucks, the shift is already showing up in the sales figures. Looking at the data, lower trims are posting double-digit gains, while pricier versions are falling behind. With price gaps between base and premium trims averaging about $5,000, who wouldn't skip the upgrades to shave a little off the bottom line? Rest assured, automakers have a plan: refocus on base models.

Automakers aren't going to accept defeat on this one. According to recent trends, it looks like they're just changing the definition of "base model" instead. That could mean sticking entry-level vehicles with technology and safety features that once would've been reserved for higher trims. Beyond that, automakers are also going to need to adjust production and inventory strategies. In other words, more lower-cost trims and smaller profit margins per vehicle.

Luckily for them, manufacturing base models is typically less complex and less expensive. That translates to faster production timelines overall. And while premium trims do come with higher profits per unit, more sales of base models could offset that difference in margin. Several major manufacturers such as Honda and General Motors have already been told by analysts to focus more on affordability. Ford, too: January sales were down overall, but sales of base model Mavericks were actually up over 33%. Even Subaru has an SUV for less than $30,000. With that, it should be obvious it's time for the rest of the industry to get with the program.