May 2024
Auto affordability: An uphill drive
Falling sticker prices are increasingly attractive to consumers, but rising total costs of ownership may be offsetting the appeal.
Key takeaways
- New and used vehicle prices have fallen from their 2021 peaks, but rising financing rates and higher insurance and maintenance costs are pressuring the overall total cost of car ownership.
- Bank of America internal data on auto loan originations suggests that overall car sales are flattening, likely due in part to these affordability issues. And a Bank of America proprietary survey finds that Americans feel as though vehicle maintenance and loans are two of the top five most difficult household expenses to afford.
- The average loan amount of used electric vehicles (EVs) is down 20% YoY, with originations increasing at faster rates than traditional gas-powered vehicles.
Read our full analysis for a more in-depth look at these trends.
