Higher prices push car payments up

Average monthly car payments in Arkansas are now $750 for new cars and $565 for used cars, according to new data from car research site Edmunds.

Why it matters: It's getting increasingly financially straining to own and maintain a vehicle, especially with higher insurance costs and gas prices.

The big picture: Vehicle sticker prices have been climbing for years, with many popular models now thousands of dollars more than they were a few years ago, Axios' Joann Muller reports.

• The average cost of a new vehicle nationwide hit a record high of $43,899 in the first quarter of the year, up by more than $2,000 since the same time last year, per Edmunds.
• As a result, car buyers are stretching their loan terms longer, to an average of nearly six years.

Stunning stat: Even with those longer terms, 20% of new car buyers now pay $1,000 a month or more, per Edmunds.

The situation isn't much better for used cars.

• Inventory on used car lots fell to 40 days' supply in March, its lowest point this year, and though it rebounded slightly in April, it remains tight.
• That's pushing those prices up. The average price for a used vehicle in Q1 was $29,314, per Edmunds.

Meanwhile, insurance premiums and repair costs are up 55% since the pandemic, according to the National Automobile Dealers Association.

• If you add up gas prices, insurance, repairs and the sticker prices of cars, the cost of owning one is up 47% since 2020, according to Navy Federal Credit Union.

• That's risen faster than both inflation and wages.

Threat level: Rising car costs are causing more Americans to fall behind on their car payments or stay out of the market.

• The average age of vehicles on the road hit a record high of 13 years last year.

Yes, but: There's a silver lining for used-car owners. They're retaining more of their value for longer, according to CarFax.com.

• So if you can swing the payment for a new car, you'll likely be able to sell your old beater for more than you would have a few years ago.