New car prices rising up to five times as fast as wages

In 2011 a new car cost 131% of the UK's average annual salary, this has increased to 150% today.

New cars have become increasingly unaffordable with prices rocketing up to five times faster than wages over the past decade, new research has found.

Moneybarn’s Carflation study has found that some car prices have more than doubled since 2011, whereas earnings have risen by one fifth over the same period.

Between 2011 and 2021, the average earnings in Britain increased by 22%, from £21,100 to £25,780, but the average cost of buying a new car increased by 39%, from £27,675 to £38,585. 

In 2011, a new car cost 131% of the UK’s average annual salary, whereas today, this has increased to 150%. 

The cost of buying a new car has increased at almost twice the rate of our earnings.

Some cars have risen in price considerably faster than others, with the following all having increased by more than 70%:

RankCar2011 price2021 pricePrice increase
1Jeep Wrangler£22,515£48,920117.3%
2Peugeot 3008£17,195£37,310117.0%
3Peugeot 508£18,450£36,01095.2%
4Mercedes-Benz V-Class£28,307£54,66093.1%
5Hyundai i20£9,745£18,80092.9%
6Volkswagen Polo£9,495£17,35582.8%
7Nissan NV200 Combi£16,610£30,22582.0%
8Volvo S60£22,535£40,04577.7%
9Hyundai Santa Fe£22,690£39,46073.9%
10Volkswagen Touran£16,675£28,90573.3%
11Honda Civic Type R£19,995£34,41572.1%
12Volkswagen Golf£13,615£23,36071.6%

Not all cars have seen such rapid increases, however, and the following have all seen an increase of less than 25%:

RankCar2011 price2021 pricePrice increase
74BMW 7 Series Saloon£57,420£71,73024.9%
75Mazda6 Tourer£20,105£24,99024.3%
75Mercedes-Benz G-Class£81,715£101,56524.3%
77BMW X1£24,270£29,93523.3%
78Ford Kuga£21,505£26,44523.0%
79Nissan X-Trail£25,280£30,92522.3%
80Volkswagen Touareg£38,955£46,78020.1%
81Vauxhall Astra Sports Tourer£17,270£20,63519.5%
82Volkswagen Tiguan£21,225£25,30519.2%
83Porsche Cayman£39,162£45,23015.5%
84Porsche Panamera£62,783£69,86011.3%
85Nissan Navara£21,033£22,9759.2%
86Nissan Leaf£25,990£25,9950%

Interestingly, the Nissan Leaf remains the same price to buy new in 2021 as it was in 2011.

When we then look at the models that have increased the most as a percentage of the average annual salary, these come out top:

Car2011 pricePrice as a % of median salary2021 pricePrice as a % of median salaryDifference
Jeep Wrangler£22,515106.7%£48,920189.8%83.1%
Mercedes-Benz V-Class£28,307134.2%£54,660212.0%77.9%
Peugeot 3008£17,19581.5%£37,310144.7%63.2%
BMW X6 M£82,190389.5%£115,815449.2%59.7%
BMW X5 M£80,795382.9%£113,115438.8%55.9%
Peugeot 508£18,45087.4%£36,010139.7%52.2%
Volvo XC90£35,025166.0%£56,135217.7%51.8%
Volvo S60£22,535106.8%£40,045155.3%48.5%
Hyundai Santa Fe£22,690107.5%£39,460153.1%45.5%
Honda Civic Type R£19,99594.8%£34,415133.5%38.7%

When we account for an increase in the average salary over 10 years, here are the cars that are cheaper than they were in 2011, account for this increase:

Car2011 pricePrice as a % of median salary2021 pricePrice as a % of median salaryDifference
Porsche Panamera£62,783297.5%£69,860271.0%-26.6%
Nissan Leaf£25,990123.2%£25,995100.8%-22.3%
Nissan Navara£21,03399.7%£22,97589.1%-10.6%
Porsche Cayman£39,162185.6%£45,230175.4%-10.2%
Volkswagen Touareg£38,955184.6%£46,780181.5%-3.2%
Volkswagen Tiguan£21,225100.6%£25,30598.2%-2.4%
Vauxhall Astra Sports Tourer£17,27081.8%£20,63580.0%-1.8%

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