DETROIT – Car buyers in the market for a new sled are aghast at the sticker shock inflected upon them when they stroll onto dealership lots, as prices have soared amidst a troubling economy for many.
According to Kelley Blue Book, the average transaction price for a new car was $50,080 in September 2025. This marks the first time the average price has exceeded $50,000, a milestone driven by a combination of factors including the end of a federal tax credit for electric vehicles and other market forces. Specifically, the average manufacturer’s suggested retail price (MSRP) also hit a new record in September, reaching $52,183.
The price increase is influenced by the expiration of a $7,500 electric vehicle tax credit, rising auto tariffs, and supply chain issues. Some blame tariffs on steel, too. The average new vehicle MSRP is expected to continue rising as the cost of recently implemented tariffs is passed on to consumers.
Factors influencing new car prices a higher share of expensive vehicles: A “rich mix” of luxury vehicles and more expensive electric vehicles (EVs) contributed to the record-high average prices. The average transaction price for an electric vehicle was higher than the overall average, at $58,124 in September.
Kelley Blue Book also noted that incentive spending by manufacturers reached its highest point in 2025 in September.
This information reflects the average price paid across all new vehicles, influenced by a variety of market factors, and may not represent the pricing of more affordable or specific vehicle segments.
For new vehicles sold in Iowa, the most popular model is the Chevrolet Silverado 1500. The Ford F-Series is also consistently a top seller in the state.
Here is a look at the most popular vehicles in Iowa based on recent sales data:
Top pickups: The Chevrolet Silverado 1500 is often the best-selling individual vehicle. Other popular trucks include the Ford F-Series and the Ram 1500.
Most popular SUV: The Chevrolet Equinox consistently ranks as a popular SUV choice for Iowans.
Overall trend: Pickup trucks have long dominated the vehicle market in Iowa due to the state’s rural landscape
and the need for hauling and towing capabilities.