For years, it seemed no sticker price was too high for American car buyers. Even as the average new car approached $50,000 this year, dealers focused more on scarce inventory than on deterring customers. Now, that dynamic is shifting.

Consumers are beginning to push back. Many are downsizing vehicles, opting for used cars, stretching loan terms, or waiting for deals. Dealers report slower showroom traffic and increased questions about affordability. “People are asking, ‘How can I afford this?’” said Robert Peltier, who owns dealerships in East Texas. He noted growing interest in smaller, less costly vehicles such as the Chevrolet Trax.

The U.S. auto industry had anticipated a banner year in 2025, fueled by tax cuts and deregulation. Analysts predicted a third-straight annual sales increase, as automakers recovered from pandemic-related disruptions and semiconductor shortages. Instead, growth is now muted, with forecasts for 2026 showing little improvement.

Earlier optimism was driven by high prices amid limited supply, as consumers shrugged off rising costs even while cutting back elsewhere. But auto tariffs, persistent inflation, and a tightening job market have prompted more Americans to rethink major purchases. The collapse of the U.S. electric-vehicle market, following the end of the federal $7,500 EV tax credit in September, has also cost the industry hundreds of thousands of potential sales.

Sales earlier this year were strong. General Motors reported a 10.5% increase and Ford 7.3% through three quarters. Yet October saw the slowest selling rate in over a year, and November is expected to continue the slowdown. Cars are sitting longer on dealer lots, discounts are rising, and lower-income borrowers are struggling with car loans.

“Other components of the economy are tugging on the consumer,” said Ivan Drury, automotive analyst at Edmunds.com.

Analysts do not expect dramatic price collapses, due to historically high used-car prices and the growing cost of maintaining older vehicles. Even as new-car margins shrink, dealers are absorbing costs to move inventory. “Something’s got to give, and it’s typically the dealer that will have to put more money on the hood,” said Erin Keating, executive analyst at Cox Automotive.

Affluent consumers, however, continue to fuel sales of high-end trucks and SUVs equipped with premium features, highlighting the K-shaped nature of the U.S. economy. “We really are relying on the top 20% of households to sustain the market,” Keating said.

Some buyers are going to great lengths to secure a deal. Petrit Xhudo, 35, from Idaho, and his wife scoured dealerships across states to buy a reliable second car. Though financially secure, Xhudo was shocked by high prices and spent a week negotiating with multiple dealers. Eventually, the couple settled on a Hyundai Tucson hybrid after securing roughly $5,000 in discounts. “They were all calling us asking, ‘What do we need to do to get your business?’” Xhudo recalled.

Even as new-vehicle sales face headwinds, ancillary business is up. Dealers report more activity in service departments, as owners strive to extend the life of existing cars.

The U.S. auto market appears set for a slower, more cautious pace, with consumers increasingly weighing affordability, financing, and value before committing to big-ticket purchases.