New-vehicle affordability was essentially unchanged in December 2025, with weeks of median income needed to buy a new vehicle holding at 36.22 (vs 36.24 in November), as wage gains offset higher rates and prices.

• The Cox Automotive/Moody’s Analytics Vehicle Affordability Index showed affordability “essentially unchanged” in December, as strong wage growth counterbalanced higher financing costs and higher transaction prices.

• The estimated average auto loan rate rose +11 bps MoM to 9.62%, though it was -31 bps YoY, indicating slightly tighter month-to-month financing conditions but improvement versus last year.

• The average new-vehicle transaction price increased +0.8% MoM to $50,326, adding price pressure relative to November.

• Income growth remained strong at +3.5% YoY, providing the main offset to higher borrowing costs and higher prices.

• The typical monthly payment increased +0.3% MoM to $767 and was up +0.1% YoY, remaining below the December 2022 peak of $795.

• Weeks of median income needed to purchase the average new light vehicle was effectively flat at 36.22 (Nov: 36.24), reinforcing that affordability did not materially improve or worsen MoM.

• Affordability was slightly better than a year ago: despite prices being +0.7% higher YoY and incentives down -17.4% YoY, affordability improved +3.2% YoY (37.4 weeks required one year ago), reflecting support from lower interest rates and higher incomes.