Car prices are rising in 2026. Will incentives help buyers?

Analysts say 2026 will bring fierce competition among automakers, but higher MSRPs and affordability pressures mean buyers may not pay less.

Early U.S. auto sales indicate this will be a year of intense competition among carmakers as the pie is expected to remain the same size as last year — yet every automaker wants a bigger slice.

According to data from J.D. Power and Cox Automotive, both forecast U.S. retail new car sales for 2026 will be flat, possibly down slightly, from 2025 when automakers sold 16.2 million new vehicles in the country.

“Looking ahead, multiple automakers have publicly stated their intent to increase their sales volume in 2026," said Thomas King, president of original equipment manufacturer solutions at J.D. Power. "However, given total new vehicle sales this year are expected to be similar to a year ago, and few, if any automakers are planning for a sales contraction, competitive intensity can be expected to rise in the coming months.”

That begs the question: Will car makers increase incentives to compete for limited shoppers and might car buyers find good deals? The answer is complicated.

"Our full year 2026 forecast is that incentives will increase $400 to $3,500, but given that last year had such a substantial electric vehicle incentive spend in the baseline, the true change is over $500 for (gasoline) powered cars," Tyson Jominy, vice president of data and analytics at J.D. Power, told the Detroit Free Press, part of the USA TODAY Network.