Why Entry-Level Cars Are Disappearing

Cars.com’s recent feature reminded us of something very real in today’s market: What Happened to the $20,000 Cars? Not so long ago, it was entirely possible to drive off the lot in a brand-new vehicle for under $20K. But now, that price point has quietly slipped out of reach for most buyers, and it’s impact is immense. Nearly all entry-level cars, like Chevrolet Spark or Hyundai Accent have been discontinued over the last decade, leaving budget-conscious buyers slim pickings.

Today’s buyers are expected to pay for features that used to be optional. And as automakers shift focus toward larger, more profitable SUVs and EVs, the concept of a truly affordable new car is becoming increasingly rare.

Why Are Affordable, Entry-Level Cars on the Decline?

There are a few reasons why entry-level cars are becoming harder to find. Rising production costs, stricter regulations, and a shift toward vehicles with higher profit margins are part of it. Add in inflation and some changes in how automakers are positioning their offerings, and it’s easy to see why buyers are facing higher prices and fewer options. Here’s a realistic breakdown of these factors:

Production price hikes

Supply chain hiccups, higher labor costs, and rising prices for materials like steel, aluminum, and lithium have driven up the cost of building cars. Unfortunately, these challenges aren’t going away anytime soon. Instead of absorbing these extra costs, automakers have shifted the burden straight to buyers, making it tougher for many to find affordable options.

Stricter regulations

These days, even entry-level cars have to meet a long list of safety, emissions, and tech requirements. Things like backup cameras, tire pressure monitors, and some driver-assistance features are now standard thanks to government regulations. On top of that, pedestrian safety is a big focus, with features like automatic emergency braking and pedestrian detection becoming more common. While all of these upgrades are great for safety, they also add to the complexity and cost of building cars, making it harder to keep prices affordable.

Automakers are focusing on big-ticket vehicles

These days, carmakers are all about the high-margin vehicles—the SUVs, trucks, and electric cars that bring in more profit. Why? Because these types of vehicles are much more profitable than smaller, budget-friendly cars. In fact, selling just one fully-loaded SUV can earn a manufacturer more than selling a handful of economy cars. For automakers, it’s all about where they can make the most money, and right now, that’s with bigger, pricier models.

Inflation is redefining what counts as affordable

Inflation has hit almost every part of our lives, and car prices are no exception. What once seemed like a reasonable price for a midrange vehicle is now considered entry-level. Take a trip back to the early 2000s, and you could snag a well-equipped mid-size sedan for around $20,000 or less. The Cars.com feature gave us a perfect example: If you take a trip back to the early 2000s, you could snag a well-equipped mid-size sedan for around $20,000 or less. The 2000 Honda Accord started at just $15,350 (not including fees or destination charge). Adjusted for inflation, that price tag would be over $29,000 today—right in line with what the 2025 Accord is priced at.

Is there hope for entry-level cars?

Electric vehicles may promise the future of transportation, but they haven’t replaced the traditional $15K–$20K commuter car. Most entry-level EVs still hover closer to $30,000. And that’s before you factor in things like charging infrastructure, which is still hit-or-miss depending on where you live.

Some international markets—particularly in China—are seeing a surge in ultra-affordable EVs. But between tariffs, strict U.S. safety standards, and trade policies, don’t expect those wallet-friendly imports to hit American roads anytime soon.

As for automakers? Their eyes are on the high-tech prize. From electrification and autonomous features to premium SUVs and trucks with fat profit margins, the focus has shifted far away from the humble economy car. Unless there’s a major change in demand or regulation, the return of truly budget-conscious new cars seems pretty unlikely—at least for now.

The Last of Its Kind: A Shoutout to the Nissan Versa

If you’re wondering whether any new car still starts under $20K, meet the 2025 Nissan Versa S. Its the last of a nearly extinct breed. The Versa starts at $18,330, making it the only new car on the market with a sub-$20K price tag. And that’s no small feat in today’s auto landscape.

Now, there are a few caveats: the base model comes with a manual transmission and modest features. If you want a smoother ride with an automatic (CVT), you’ll need to spend about $1,800 more. Still, for budget-conscious buyers who want reliable transportation with the peace of mind of a full manufacturer warranty, the Versa is a rare gem.

But how long will it last? Rising production costs and automakers margin focus might eventually push the Versa out of this price bracket—or off the lot altogether. And if that day comes, the era of the truly affordable new car might officially be over. So here’s a quiet salute to the Versa: holding the line while it still can.