Just five years ago, a price-conscious auto shopper in the United States could choose from among a dozen new small cars selling for under $20,000
Just five years ago, a price-conscious auto shopper in the United States could choose from among a dozen new small cars selling for under $20,000. Now, there’s just one: The Mitsubishi Mirage. And even the Mirage appears headed for the scrap yard.
At a time when Americans increasingly want pricey SUVs and trucks rather than small cars, the Mirage remains the lone new vehicle whose average sale price is under 20 grand — a figure that once marked a kind of unofficial threshold of affordability. With prices — new and used — having soared since the pandemic, $20,000 is no longer much of a starting point for a new car.
This current version of the Mirage, which reached U.S. dealerships a decade ago, sold for an average of $19,205 last month, according to data from Cox Automotive. (Though a few other new models have starting prices under $20,000, their actual purchase prices, with options and shipping, exceed that figure.)
The Mirage, with hatchback and sedan versions, costs less than half of what the average U.S. new vehicle does. That average is now just above $48,000 — 25% more than before the pandemic struck three years ago.
“I just won’t pay that kind of price,” said Karen Schaeppi of suburban Minneapolis, who bought a red Mirage sedan last month for around $19,000. Schaeppi, who is 78, said she could have afforded an average-priced new vehicle. But because she’s only 5 feet tall, she wanted a small car so she could see easily over the hood.
When she set out to replace her 2008 Ford Focus, Schaeppi was surprised to find no small cars available at the dealers she visited — at any price.
“There was nothing that existed, » she said. “Not even close.”
The scarcity of small cars at dealerships helps explain why the average new vehicle costs so much: Detroit’s Big Three automakers — General Motors, Stellantis and Ford — began to jettison the compact and subcompact car business about five years ago. Low profit margins for small cars and consumers’ increasing shift to SUVs and trucks made the decision an easy one. Likewise, Toyota and Honda later halted U.S. sales of their subcompacts.
Then a pandemic-related computer-chip shortage slashed global auto production. Vehicles were suddenly in short supply at a time of high demand. Prices shot up.
Another factor that has swollen average prices is that 32 models in the United States now have selling prices above $100,000, according to Cox.
