That's how many prospective car buyers have permanently left the new-car market since 2020, according to auto industry analysts, priced out by vehicles that now average around $50,000, persistent inflation, high interest rates, and gas prices pushed higher by the conflict in Iran. Americans were buying around 17 million cars and trucks a year before the pandemic; industry analysts now forecast annual sales of 16 million or fewer this year, with no return to pre-pandemic volumes expected until the end of the decade at the earliest. The shift has direct implications for state and local governments: Motor vehicle sales taxes are a significant revenue source for dozens of states, and declining car sales compound the fiscal pressure already building from federal funding cuts and slowing income tax receipts.
