The average age of registered vehicles on the roads in the United States is now older than ever, a potential sign that improved quality and reliability is driving consumers to hold onto their vehicles for longer.
According to a study from IHS Markit, the average age of cars and trucks in the US is currently 11.8 years, up 0.1 years from 2018.
In addition to vehicle reliability, financing is another major contributor to how long people keep their vehicles. Cars are, on average, more expensive in the current day and consumers are more likely to finance them for longer periods – sometimes up to six or seven years.
IHS Markit’s data indicates that those in western states have the oldest cars – hardly surprising, seeing as they also get the driest, sunniest weather. Western residents’ average vehicle age is 12.4 years, while the Northeast’s is just 10.9 years, for comparison. Montana residents’ have an alarmingly old vehicle age of 16.6 years.
While a study like this may seem a bit inconsequential, it is actually quite indicative of current automotive trends. US auto sales are predicted to dip 1.5% this month and experts are chalking that up to the rising average transaction prices for new vehicles. With many consumers priced out of new vehicles, more and more Americans will be holding onto their old vehicles or shopping used instead of replacing it with a new one.
According to data obtained by J.D. Power, the average vehicle transaction price in the first six months of the year is about $33,346 – up 4% year-over-year. Not only is this much higher than last year, it is also the highest-ever average vehicle transaction price for a six-month period.