Cheap Cars Vanish from U.S. Market as Major Automakers Shift Gears

ArabGT

a day ago

Finding a budget-friendly new car in the U.S. is becoming almost impossible. The once-thriving market for vehicles priced under $30,000 is rapidly vanishing, with American auto giants playing a key role in its decline.
Back in 2019, nearly 38% of all new car sales were in the sub-$30,000 range (around SAR 112,500). Fast forward to today, and that figure has shrunk dramatically. Fewer than one in ten new cars now fall under that price point. Entire models have vanished from showrooms—take the Mitsubishi Mirage, once priced just below $15,000 (about SAR 56,250), now discontinued.
Why Are Cheap Cars Disappearing?
The vanishing act of affordable cars is no mystery—it's the result of a combination of economic and strategic shifts:
Rising production costs driven by inflation and international trade tariffs
A shift in focus by automakers toward high-margin SUVs and luxury vehicles
Competitive market forces that push prices upward and deprioritize economy segments
Automakers like Ford and General Motors have gradually moved away from producing entry-level cars, citing reduced profitability compared to more lucrative categories. They're investing more in upscale models, where returns are more predictable.
Used Cars: No Easy Escape
The situation isn't much better in the used car market. With affordable new cars in short supply, demand for older, lower-priced vehicles has spiked. The result? Scarcity. Many drivers are holding on to their vehicles longer, as upgrading is no longer economically feasible.
The numbers are stark: new cars priced below $25,000 have plummeted by 78%. This isn't just a statistical trend—it's a sign of a deeper economic shift. For many families, the traditional milestone of buying a first car for a teenager or a dependable ride for an aging parent is slipping out of reach.
The Harsh New Reality for Budget-Conscious Buyers
If this trajectory continues, low-income drivers and first-time buyers will be left with two unappealing choices: settle for an overpriced used vehicle or spend nearly double on a new one that's likely bigger, more complex, and far more expensive to maintain.
The clear message? Affordable cars are vanishing—and America's largest automakers are driving the shift. Their pricing strategies and production priorities have effectively erased budget models from their plans. The era of the cheap, dependable car is becoming a relic of the past.