The average age of vehicles in the U.S. has reached a new high of 12.6 years in 2024. This milestone reflects a trend where owners hold on to their cars, trucks, and SUVs longer due to the steep costs of new vehicles. According to S&P Global Mobility, which monitors state vehicle registration data, the average vehicle age has increased by about two months from the previous year, continuing a trend from 2023 when it rose by three months.

However, the rate of increase in vehicle age is beginning to decelerate as the market recovers from the pandemic-induced parts shortages, particularly of computer chips, that previously hampered new vehicle production. Despite the gradual return to normalcy, the cost of new vehicles remains a significant barrier for many consumers. The average price for a new car recently stood just over $45,000, down from a peak in December 2022 but still beyond the reach of many buyers.

Todd Campau, an expert from S&P Global Mobility, notes that high prices force many consumers to extend the life of their current vehicles. Other contributing factors include uncertainty about whether to invest in electric vehicles, hybrids, or traditional gasoline-powered cars, given concerns about the availability of charging infrastructure.

The trend of holding onto vehicles longer is also bolstered by the improved durability of modern vehicles, which tend to last longer than those made in previous decades. This longevity is beneficial for the auto repair industry, as around 70% of vehicles on the road are six years or older, often out of manufacturer warranty and requiring regular maintenance.

Meanwhile, new vehicle sales in the U.S. are rebounding, with expectations of reaching around 16 million units this year, up from 15.6 million in 2023 and 13.9 million in 2022. This recovery is driven by price and interest rate considerations rather than pandemic-related issues. As sales of new, often more affordable, vehicles increase, the average vehicle age may stabilize. This shift also suggests a potential reduction in the average price of new vehicles, as lower-cost models gain popularity.

Source: Associated Press