If Safety Tech Isn’t Most Responsible For Increasing Car Prices, What Is?

The increasing cost of cars has been a topic of discussion, with many attributing it to the high cost of advanced driver-assistance systems (ADAS). However, according to David Harkey, president of the IIHS-HLDI, safety features are not the main contributor to rising prices.

Instead, Harkey points to consumers opting for non-ADAS upgrades such as hands-free tailgates and power-folding mirrors, as well as the preference for larger, more expensive vehicles like trucks and SUVs. The average purchase price of a new vehicle is $49,220, up 1.2% year-over-year.

Additionally, dealer markups, which can add nearly $5,000 to the price of a new vehicle, also play a significant role in increasing car prices. For example, the 2027 Chevrolet Silverado has a starting price of $53,700, with a destination freight charge of $2,795, and requires the purchase of two separate packages to add a blind-spot system, increasing the price by $1,690.

The issue of rising car prices is complex, with multiple factors contributing to the increase, including consumer preferences, dealer markups, and the cost of upgrades.