Record Vehicle Payments Meet Resilient U.S. Sales as Used EV Activity Grows

U.S. vehicle demand is holding up even as buyers stretch their budgets to reach the new-car market. Edmunds’ Q3 2026 data show record borrowing and monthly payments, while Cox Automotive raised its full-year new-vehicle sales forecast to 16.1 million. The picture is more mixed for used vehicles: retail demand remains active, but wholesale values weakened and depreciation accelerated.

Longer loans, higher lifetime costs

The average amount financed for a new vehicle reached $44,664 in Q3, up from $44,156 in Q2 and $42,744 a year earlier. Average monthly payments rose to $787, compared with $777 in Q2 and $756 in Q3 2025. The average annual percentage rate stayed at 7%, matching both comparison periods, so the rise in borrowing costs reflects larger loans and longer repayment schedules as well as the interest rate.

Loans of at least 84 months made up a record 25.5% of financed new-vehicle purchases. That share was 23.9% in Q2 and 21.8% a year earlier. Edmunds calculated that buyers will pay an average of $9,938 in interest over the life of a financed new-vehicle purchase, up from $9,811 in Q2 and $9,442 in Q3 2025.

Four-figure payments are becoming more common, too. A record 21.2% of financed new-car buyers took on monthly payments of $1,000 or more, compared with 20.3% in Q2 and 19.1% a year earlier. Among used-vehicle buyers, the share reached a record 6.5%, up from 6.3% in Q2 and 6.1% in Q3 2025.

Edmunds’ head of insights, Jessica Caldwell, described buyers as continuing to shop despite the pressure, adjusting household budgets and looking more actively for financing. The data suggest that demand has not yet fallen away in response to higher payments. They also show how buyers are managing the gap: by taking longer to repay loans and accepting larger monthly commitments.

That trade-off is especially clear among new-car buyers paying at least $1,000 a month. In Q3, 69% of that group chose terms of 72 months or longer. Edmunds director of insights Ivan Drury cautioned that a payment that fits today can obscure the total commitment. With the average loan nearing $45,000 and average interest approaching $10,000, the full loan cost matters as much as the monthly figure when comparing vehicles.

Source: Edmunds

New-car sales forecast rises

Cox Automotive expects September new-vehicle sales to be 6.5% higher year over year, though 2.7% below August. The firm cautions that seasonal patterns make month-to-month comparisons difficult. Senior economist Charlie Chesbrough expected sales to remain near the low-to-mid 16 million annualized pace the market had followed since March.

Cox raised its 2026 new-vehicle sales forecast to 16.1 million from 15.8 million. It cited strong summer sales, better access to credit and sustained buyer demand. Chesbrough pointed to fleet purchases and the greater affluence of many new-vehicle buyers as factors supporting sales despite inflation and low consumer confidence.

The forecast revision suggests that current affordability strains have not translated into a broad retreat from new-car shopping. But sales volume alone doesn’t show how comfortably buyers are absorbing the cost. Edmunds’ record payment and interest figures point to a market where demand remains firm alongside a growing reliance on long loans and high monthly outlays.

Used market: steady retail activity, softer values

For 2026, Cox expects 20.5 million used retail sales and 38.5 million total used-vehicle sales. Its forecast for pre-owned sales is 2.6 million units. The firm raised its outlook for retail and total used sales, although total sales are still expected to finish slightly below 2025 levels.

Wholesale values moved in the other direction. Cox’s Manheim Used Vehicle Value Index stood at 205.9 in September, down 0.6% from a year earlier and 1.1% from August after adjustments for vehicle mix, mileage and seasonality. Cox said depreciation accelerated during Q3, with September declines steeper than typically seen at that point in the year. It cut its year-end index outlook: the measure is now expected to finish 2026 up approximately 0.2% year over year, rather than the 2% increase forecast in July.

For dealers and shoppers, the distinction between retail demand and wholesale pricing matters. Used vehicles can continue to sell at a healthy pace even while auction values soften; those figures measure different parts of the market. Cox chief economist Jeremy Robb said higher fuel costs, rising interest rates and broader economic pressure weighed on wholesale prices in September.

EVs gain ground in used channels

Electric vehicles made up a growing share of Manheim auction activity. Wholesale EV sales were up 22% from Q2 and 45% year over year. EVs accounted for a record 4.9% of all Manheim transactions in Q3, compared with 3.9% in Q2.

Used retail EV sales reached 124,000 in Q3, the highest level recorded and an 11.4% increase from a year earlier. They still represented about 2.8% of all used retail sales, leaving plenty of room for growth from a relatively small base. The combination of rising EV sales and softer wholesale vehicle values will be worth watching in the next round of market data, particularly for buyers comparing used EVs with new models.

Featured image credit: Fahroni/iStock. Charts provided by Edmunds and Cox Automotive.