New-vehicle affordability declined in September, according to the Cox Automotive/Moody’s Analytics Vehicle Affordability Index. Higher transaction prices outweighed strong income growth, slightly lower interest rates and a modest uptick in incentives.
The estimated average auto loan rate decreased by 1 basis point to 9.45%1, which was lower year over year by 9 basis points. The average vehicle price increased 0.9% for the month to $50,562, according to Kelley Blue Book’s September average transaction price report, and was just shy of the record of $50,614 set in December 2025. Income growth remained strong at 3.8% year over year, though it has cooled from the 4% seen in July. Incentives rose 2.6% for the month to roughly $3,359, which helped but was not enough to offset the price increase.
Cox Automotive/Moody’s Analytics Vehicle Affordability Index
Weeks of Income Needed to Purchase a New Light Vehicle
The typical payment increased 0.8% to $776, which was up 1.3% year over year and the highest monthly payment since December 2023. The number of median weeks of income needed to purchase the average new vehicle increased to 35.6 weeks from 35.5 weeks in August, the least affordable reading since January. The average monthly payment peaked at $795 in December 2022.
New-vehicle affordability was better than a year ago in September, even though prices were 0.7% higher, as lower interest rates and higher incomes improved affordability. Incentives were 8.8% lower than a year ago. New-vehicle affordability improved by 2.5% compared to a year ago, when it took 36.5 weeks of median income to purchase the average new vehicle.
Click here for the full methodology for the Cox Automotive/Moody’s Analytics Vehicle Affordability Index. Follow the link to review the full series of Vehicle Affordability Index reports.
The next update of the Cox Automotive/Moody’s Analytics Vehicle Affordability Index will be published on Nov. 16.
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.
