Inflation Squeezes Drivers On Car Prices And Cost Of Ownership

The auto industry needs to stop and reflect as yet another study shines a light on how inflation is squeezing drivers. But it’s not just the sky-high prices for both new and used vehicles that have consumers crying for relief. The cost of owning a car is also putting people in a bad position financially.

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That new study conducted by Guardian Service contains some alarming, but sadly familiar, beats. For starters, 56 percent of Americans surveyed say they’re delaying buying a new car thanks to all the economic uncertainty.

Affordability is a high concern, with 43 percent saying the lack of affordable options on the market is a factor, while 34 percent cite monthly payment amounts being too much for their budget. And 29 percent say they don’t want to buy a ride at the moment thanks to worries about their job or income remaining stable.

Kara Credle, Licensed Insurance Agent at Guardian Service shared her thoughts with us on what’s happening: “Car ownership used to be a milestone of independence, but in 2025, it’s increasingly seen as a financial risk. Rising interest rates and inflated prices are pushing even young buyers—Millennials and Gen Z—to delay purchases or avoid ownership entirely.”

On the cost of ownership front, insurance was front and center. While 77 percent of respondents said it’s an essential thing to have, 15 percent say in the past year they’ve either downgraded their coverage or canceled their plan to save money.

That makes sense since many Americans’ monthly car insurance premiums are what most car payments were at just ten years ago.

If this trend keeps up, we fear what the future of personal mobility might look like here in the US. Maybe some will celebrate a shift towards people riding buses, walking, cycling, etc. but we know with the geographical features of this country, those types of solutions are often ineffective.

In other words, Americans need cars. If the traditional auto industry fails to provide them, someone else might swoop in and serve up a necessary solution.

Read more about the survey here.

Image via Gustavo Fring/Pexels