New-vehicle affordability improved in March for the fifth straight month, according to the Cox Automotive/Moody’s Analytics Vehicle Affordability Index, driven largely by strong income growth, steady prices and interest rates, and increased incentives, all of which boosted buyers’ purchasing power.

The average transaction price (ATP) for a new vehicle in March was mostly flat month over month, falling 0.1% to $49,275. Prices were higher year over year by 3.5%. Incentives were also higher in March, up 5.5% year over year.

The estimated average auto loan rate was flat last month, down by just 1 basis point to 9.50% but higher compared to March 2025 by 16 basis points. Importantly, income growth stayed strong at 3.9% year over year, according to Moody’s Analytics. These factors all worked together to make new vehicles more affordable in March.

Cox Automotive/Moody’s Analytics Vehicle Affordability Index
March 2026

Weeks of Income Needed to Purchase a New Light Vehicle

The typical monthly payment for a new vehicle fell by 0.5% in March to $752, but was higher year over year by 2.9%, up from $731 a year ago. Still, with household income higher by 3.9%, the number of median weeks of income required to buy the average new vehicle dropped to 35.1 in March, down from 35.4 weeks in February and at the lowest point in nearly four years.

While new-vehicle affordability in March was better than it was a year earlier and continues to generally improve as household income grows, other challenges continue to place pressure on vehicle affordability in the U.S.

In addition to the immediate financial pressure of $4-a-gallon gas prices, major vehicle ownership costs such as maintenance, repairs and insurance have all seen sustained, outsized increases since the pandemic. For example, while new-vehicle prices are higher by roughly 15% versus 2021, some estimates suggest vehicle insurance costs have increased by nearly 60%, while routine service and maintenance costs are higher by 40%. The compounding effect of these higher prices is at the heart of today’s affordability conundrum.

Click here for the full methodology for the Cox Automotive/Moody’s Analytics Vehicle Affordability Index.

View historical Cox Automotive / Moody’s Analytics Vehicle Affordability Index reports.

The next update of the Cox Automotive/Moody’s Analytics Vehicle Affordability Index will be published on May 15, 2026.

1 The index input of the average interest rate paid by consumers is calculated to reflect a 72-month, fixed-rate loan. For the latest Dealertrack estimated volume-weighted average new loan rate, visit the Auto Market Snapshot.

The Cox Automotive/Moody’s Analytics Vehicle Affordability Index (VAI) is updated monthly using the latest data from government and industry sources, including key pricing data from Kelley Blue Book, a Cox Automotive brand. This important industry measure will be released at mid-month to indicate if the prices paid for new vehicles are moving out of consumers’ financial reach or becoming more affordable over time.