Vehicle prices are still sky-high these days, even as the market frenzy cools – averaging more than $48,000 for a new vehicle and $28,000 for used.

The story has been repeated countless times over the last two years: supply chain shortages meant fewer cars, which meant skyrocketing prices, contributing substantially to inflation.

But that is only part of the picture. When it comes to owning a car, inflation also has dinged the budget of almost every adult in the United States, regardless of how much they make, where they live, or what they do for work. Even Americans with paid-off vehicles are seeing costs creep up.

“Even if you’re not buying something new or used, your continued relationship with your car is getting more expensive,” said Ivan Drury, director of insights at the automotive data site Edmunds.

Maintenance and repair: Rising faster than inflation. Insurance premiums: On the rise. Fuel? Gasoline and diesel are both significantly higher than pre-pandemic levels.

Leonela Garcia, a single mom of two in Southern California, has a 50-mile commute to her job as a dental assistant and office manager. She’s driven her 2011 Kia Optima for nearly a decade. It was a reliable ride, until the moment on the freeway when she learned what a blown head gasket sounds like. She faced a $5,000 mechanic’s bill.

The figure shocked her, and it left her kind of stuck.

“I wish that I just … could afford it,” she said. “But, you know, everything’s so expensive.”

Over the past few years, the costs of repairing and maintaining a vehicle had slightly outstripped inflation, according to the Consumer Price Index, the most widely used measure of inflation. And then this year, they skyrocketed.

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The cost of maintaining an older vehicle, especially one still running long after its warranty expired, is typically higher than the upkeep of a new one fresh off the lot.

And lots of people are hanging on to their cars for longer and longer, with the average age of a vehicle on the road now north of 12 years. Vehicles today are better-made than those a generation or two ago, and simply go farther with fewer problems. That’s likely one reason why Americans today, overall, spend a smaller chunk of household budgets on transportation compared to the 1980s.

But individually, Drury says, if you drive a car long enough, “you’re going to find out what it’s like to change the timing belt for the second time. You’re going to find out that, hey, labor rates have gone up … certain parts are getting harder and harder to find.”

It’s easy to find a used car … at a certain price

Faced with high repair costs a few years ago, drivers might have looked for a replacement vehicle instead. But now cheap rides are extremely hard to find in the used car market.

“The lower the price, the tighter the inventory,” said Brian Moody of Autotrader.

There are plenty of options on used car lots in the $35,000-and-up range – 65 days’ worth of inventory, according to his company’s internal data.

For cars under $10,000, it’s half that.

“There’s an abundance of used cars,” Moody said. “But we’re still talking about cars that are transacting in the $25,000 to $28,000 range. Well, where I come from, that’s a lot.”

In short, there are a lot of nice cars floating around. Not a lot of bargains.

And that’s even more true in the new car market, where prices have soared dramatically.

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For those astonishing prices, new car buyers are getting some remarkable vehicles. Americans are buying massive trucks and SUVs (even if they could get by with a sedan). They’re buying more luxurious vehicles. And they’re buying autos packed with sensors and cameras and cutting-edge safety features.

This is not quite the same as normal inflation, where, say, the price of a gallon of milk goes up. For all the extra money they’re spending, new car buyers are getting much better cars.

“Milk is still milk. Cheese is still cheese,” said Drury, of Edmunds. “But your car, even if you bought the same [make of] car 20 years ago, that’s not the same car today. It has had billions of dollars poured into it and you’re getting the results of it.”

New cars may be luxurious, but cars aren’t just a luxury. For many people, they’re a necessity to get to work, doctor’s appointments, the grocery store and pretty much everywhere else. That necessity comes with costs: time spent commuting, air pollution, climate change, road fatalities, and, of course, a sizeable financial burden.

And while new car buyers are getting new car perks, those who have to buy and own older cars are paying a lot more for the same, or even less, than they’re used to.

Take Leonela Garcia, who considered whether she should upgrade her vehicle. With her bad credit, the only loan she was approved for carried 28.9% interest. Her response — “Who does that?”

Then there were the used vehicles she saw: “I’m looking at the prices and it’s … it’s ridiculous.”

So instead of any upgrade, she decided her best bet is sitting right there in her driveway, blown head gasket and all. Her Optima’s not moving, but it’s sparkling clean.

“I wash it,” she said, “because I don’t want the paint to get ruined, because in my head I’m like, ‘I’m going to get this car going.'”

Garcia launched a GoFundMe, and through that and other donations, raised a couple thousand dollars. She plans to ask family to help her borrow funds to cover the difference. She’s a little amazed at the thought of sinking this much money into her old Optima.

“It’s just still mind-blowing how much car parts and labor and all these little things in between could cost,” she said.

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