The last new car you can buy for less than $20,000 — and it's going away soon
Whitney Nixon drives a few hundred miles a month for work, and her 2018 Dodge Durango three-row SUV was, in her words a "gas guzzler," costing her a fortune to fuel with premium gasoline.
Nixon, who is 30 and lives in Southgate, Michigan, needed a new ride. But with a tight budget, a new vehicle had to be affordable ‒ a tall order for car shoppers these days, given that the average transaction price of a new vehicle in October topped $48,600, according to Kelley Blue Book. Nixon started looking in late October and found the 2024 Mitsubishi Mirage compact hatchback, which gets a combined 39 mpg and starts at a list price of $16,695.
"Originally, it was the regular Mirage that caught my eye, but then the salesman showed me, 'We do have this edition,' and I thought, 'That’s so cute,'" Nixon said.
The "cute" Mirage that she ended up buying on Nov. 7 was the Ralliart edition, which has racing-inspired trim to give it a sporty look. For Nixon, the best part was walking out the dealership door paying a grand total of $20,300 after taxes, fees and other add-ons.
"I love it, and $25 fills me right up," Nixon said. "It’s a small, compact car, but it’s actually comfortable and roomy on the inside and the interior is nice.”
The Mitsubishi Mirage, which also comes in a G4 sedan style, is a rarity. According to Kelley Blue Book, it is one of the last cars with an average transaction price of under $20,000. Sure, other small cars such as the Nissan Versa list for less than $20,000, but customer costs are averaging more than that.
"Key word is 'transacting' under $20,000. Lots of cars have 'starting prices' well lower than what the (auto)makers build and ship to dealers. Our (average transaction price) is looking at the bundle of vehicles actually delivered in a given month, and the average thereof," said Mark Schirmer, director of industry insights and corporate communications at Cox Automotive, which owns Kelley Blue Book. "So not advertised or promoted price. What is actually built and sold."
'For less than $20,000, you get a lot'
According to Kelley Blue Book, among new cars sold in November, these were the least expensive by average transaction price:
◾ Mitsubishi Mirage at $19,085
◾ Nissan Versa at $20,874
◾ Kia Forte at $23,169
◾ Hyundai Venue at $23,625
◾ Kia Soul at $24,001
Schirmer said the incentives that automakers offered in this segment are quite small. In November, the average incentive package across the industry was equal to 8% of the average transaction price. In the subcompact car segment, where the Mirage is, the typical discounting was 3.4% of the average transaction price, he said.
Nixon bought her Mirage at Glassman Mitsubishi in Southfield, Michigan, where dealer principal Michael Glassman said he has a hard time keeping them in stock because shoppers come in looking to buy a certified used car, then discover they can get a brand new Mirage, often for less.
Certified used cars are vehicles that have been reconditioned and carry a limited warranty, but cost less than most new cars. According to the shopping site CarGurus, the average used vehicle list price in October was $28,200.
Glassman said the Mirage comes with a 10-year or 100,000-mile powertrain warranty for $20,000 or less.
"Having a brand-new car with a 100,000-mile warranty is very appealing to customers,” Glassman said. "Automakers look to head in the luxury direction ... and they’re missing the people who are looking to just afford a car."
Lynn Fleischer, 60, of Grand Blanc, Michigan, is such a buyer. Fleischer bought her 2024 white Mirage in October at Grand Blanc Mitsubishi, where she also works. She said a colleague had bought a Mirage a year earlier and Fleischer spent 12 months "drooling over it" and wanting one herself.
"I didn’t want a car payment, but it’s so affordable that I just thought, 'I’m going to get it,' " Fleischer said. "The new SUVs are $800 a month. I couldn’t afford it."
Affordability is Fleischer's top priority in a car purchase, noting she has a minivan that she "hates" because it's expensive to operate and refuel due to a larger gas tank. Plus, it is "big and bulky" to drive. She said she paid a grand total of $17,500 for her Mirage and spends less than $20 to fill it up with gasoline.
"I go to Sam’s Club and I can fit everything in it," Fleischer said. "This one has a backup camera in it. It has Apple CarPlay and the controls right on the steering wheel. For less than $20,000, you get a lot.”
Least expensive car will be gone soon
Besides affordability, Fleischer admits she also wanted to get the Mirage because she knew Mitsubishi will not be making it next year.
In August, the company confirmed it will not make a 2025 Mirage. That leaves the Nissan Versa as one of the last cheap cars at a $17,820 base price.
Mitsubishi, which did not respond to requests for comment on this article, will stop production of the Mirage late this year and expects to have enough inventory to last into the summer of 2025, according to a report in Car and Driver. While affordable cars are popular, the Mirage had been seeing shrinking sales in recent years, and "it also had the distinction of being the wimpiest, with both body styles featuring a 78-hp(!) three-cylinder engine," Car and Driver wrote.
In terms of reliability, J.D. Power spokesman Geno Effler told the Free Press the research experts do not break down their reliability rankings to the model level, but he said, "Mitsubishi, as a brand, has low initial satisfaction results (lowest-ranked mass-market brand for 2024 APEAL) and its initial quality is just below average."
J.D. Power's APEAL stands for Automotive Performance, Execution and Layout study. It measures how owners feel about their new car's design, performance and overall experience after owning it for a short period. Effler said the long-term dependability of the brand was not ranked for 2024 because of low sample returns.
"Going back to 2023, we had sufficient sample for the brand, and it ranked fourth in the mass market segment," Effler said of Mitsubishi's long-term dependability.
Jay Lasco, dealer principal of Grand Blanc Mitsubishi, noted the Mirage's attributes.
"The price is No. 1," Lasco said. "People love the price of the Mirage. People love the warranty, it has more affordable maintenance and it’s a great value. It’s easy to park. It’s fun to drive. Every time they pull up to the gas pump, that makes it even better. It’s not for everybody. If you have a Great Dane (dog) and three kids, it’s not for you."
The struggle to make cheap cars
Still, the small car's absence will leave a hole in a market where consumers will increasingly want affordability in 2025, experts predict.
"We’ve seen so many (affordable) cars go away," said Brian Moody, senior editor of Kelley Blue Book. "The one I always think of is the Honda Element. It wasn’t like nobody wanted it, even now people say, 'Why don’t they bring that back?’ I just don’t think they can sell enough and use their new platform and that kind of stuff.”
The Honda Element SUV was discontinued in 2011, which had a starting sticker price of $22,885 when new, according to Kelley Blue Book.
Moody said automakers struggle to offer lower-priced cars because they need to sell them in big volume to show a profit. Also, as regulators require additional safety features, production costs increase.
"You can’t require backup cameras and say it’s still going to be priced at $20,000," Moody said. "That’s got to come from somewhere."
Future affordable Mitsubishi vehicles
Glassman said the Mitsubishi brand is a small seller for him now, but it is growing. He sells about 20 to 25 Mitsubishi vehicles a month, tiny compared with his sales of Hyundai, Kia and Subaru brands. Glassman sells about 130 Subaru vehicles a month and Hyundai and Kia each account for about 75 sales a month.
"But those companies remind me where Mitsubishi is headed," Glassman said. "We were the first Kia dealer in Michigan so we’ve seen them come from a brand that needed some help and people didn’t consider much, to now they are one of the best out there. Originally, it was because of affordability. But now they have found the right consumer and they understand the styling and they fought to change their image."
He said Mitsubishi is broadening the brand to offer, for example, the 2024 Outlander Sport SUV, which starts at $23,695.
Lasco said the 2025 Outlander plug-in hybrid is expected to help spark brand sales, but it starts at $42,170, hardly in the affordable range unless you lease it. Lasco said the automaker offers a lease on it for under $300 a month with $500 down.
“It’s a plug-in electric that can be plugged into a normal home outlet,” and it goes 50 miles on electric before running on gasoline after that, Lasco said.
It's on the consumer to find affordable new cars
Moody said affordable vehicles are out there, but consumers must search for them. He said Nissan has been positioning itself to have several models starting under $30,000. The Chevrolet Trax has been a hit for General Motors this year with a starting price of $21,495. As the Detroit Free Press reported, GM sold 59,299 Trax in the third quarter alone, a 56.6% gain year-over-year.
"(Automakers) are already seeing that we cannot keep putting forth $40,000 cars minimum and expect to keep selling cars, especially for certain brands that people might associate value with," Moody said. "Of course, have your top-of-the-line one, but … price pressure downward is going to continue to be a thing. I wouldn’t be surprised if an automaker or two came up with a line of cars that were (basic) and low-priced or even maybe a sub-brand: Here’s our value line."
For now, there remain "plenty" of good vehicles priced under $30,000. Moody pointed to the Toyota Corolla Hybrid SE, which is listed as starting at $25,940, according to Edmunds.com.
"It’s a sporty looking one, it’s got nice wheels, a cool little exhaust, you wouldn’t look at it and say, 'Oh it’s a cheap one,'" Moody said. "You would look at it and say, 'Oh that’s pretty nice.'"
There are more like that, but consumers have to find them.
"If you show up at a dealership, what they’re going to show you is what they have. You have to be more in the driver’s seat and say, 'I want this, this and this,'" Moody said.
But he said finding any new vehicle for around $20,000, is going to be increasingly harder.
"The $20,000 thing, that’s a pretty tough nut to crack," he said.
Contact Jamie L. LaReau: jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.
(This story was updated to add a video.)