The price of cars, both new and used, has risen at an unprecedented rate for well over a year. There are several reasons for this.
The primary reason for the new car price surge is simply a shortage of cars, due largely to a shortage of the microchips used in car electronic and infotainment systems. Many semiconductors come from Taiwan. No one in the auto industry believes this problem will improve until next year.
Supply chain shortages have shut down manufacturer assembly lines. Many car companies have had to deal with a drop in revenue. This has occurred at the same time they have started multi-billion-dollar investments in electronic and autonomous vehicles. The resulting financial squeeze has become considerable.
As new car prices have risen, people have turned their focus to used cars. Increasing demand has resulted in a shortage of used cars. The consumer price index shows that used car prices rank among the fastest rising items people can buy, based on costs year over year.
These shortages have encouraged people to keep their own cars longer for financial reasons. The average age of a car on the American road has increased to over 12 years, which is an all-time high. Another reason people can own older cars is their durability, which outpaces that of cars over a decade old.
The price to own a car goes beyond the price to buy it. The Car Repair Hotspots: The U.S. States With The Cheapest Car Maintenance and Repair Costs study from coupon code provider DealA included the average cost of insurance and repairs, as well as safety inspection and oil change prices. The index these create is the “total repair and maintenance costs.”
Ironically, the state with the highest price is home to the birth of mass-produced cars in America. The top state for high costs is Michigan with a total of $4,644. That puts it well ahead of second-place Louisiana at $3,850.
These are the 10 most expensive states in which to own a car:
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