Expect another frothy sales month when automakers report August results this week. And if the pattern holds, average transaction prices will have risen in lockstep, flirting with yet another record.
Stout pricing has been a hallmark of the four-year sales rebound. Consumers aren't just buying a lot of vehicles. They're springing for pricier ones too, with more features, advanced powertrains and nicer interiors -- stagnant wages and weak job market be damned.
But they're also stretching themselves further to be able to afford those nicer rides. Even with rock-bottom interest rates, new-car buyers are taking on more debt and dragging their payments across longer periods than ever before, according to Experian Automotive.
Some industry watchers see the price issue as a potential stumbling block in an otherwise clear glide path back to the halcyon days of 17 million-plus U.S. light-vehicle sales. They worry that escalating prices, when coupled with an uptick in interest rates, will put a new car out of reach for a swath of prospective buyers.
Through July, the average transaction price of a new vehicle was $30,988 this year, up 12 percent from $27,683 for all of 2008, according to TrueCar. And the extremely long loans many buyers now need to afford that new car will keep them out of the market for years, sabotaging future sales, some industry watchers say.
The rising prices come despite stubbornly flat wages for American consumers. During the five-year period through July, the U.S. Bureau of Labor Statistics measure of real average hourly earnings, adjusted for inflation, slipped 0.05 percent.