New cars are so expensive in Canada these days

There's a report in the paper saying that the average price of a new car in Canada is now $66,000 in Quarter 2 of 2023. AVERAGE! This is according to AutoTrader's price index report. Even higher in provinces like Alberta and British Columbia.

This was a shock, because I have an electric Hyundai Kona, which I thought was well above the average price, and I paid $55,000. So, what are all these (even more) expensive cars out there? I know there are Porsches and Maseratis, but these are not mainstream popular vehicles 

I searched for "cost of most popular cars in Canada" and found Ratehub's list. There I see Toyota Rav4 ($55,921), Toyota Corolla ($33,096), Honda CR-V ($32,086), Honda Civic ($29,722), Hyundai Kona ($24,579), etc. This is hardly going to average out to $66,000, so what gives?

Next, I searched for "cost of most popular vehicles in Canada", because I remember that pickup trucks are ridiculously popular in Canada, and I found driving.ca's list. There I see Ford F-series trucks ($39,115), RAM pickups ($48,945), Toyota Corolla ($19,450), Honda CR-V ($31,470) Chevrolet Silverado ($32,648), etc. But this is not going to add up to $66,000 either!

Then it occurred to me that it may be as simple as the fact that these other lists are just not as up-to-date as AutoTrader's. Checking back to Quarter 2 of 2022, AutoTrader suggests that the average cost if a new car was $55,000, not $66,000. So, the last year has seen a 20% increase! Quarter 2 of 2021 shows $46,700, so there has been a more than 40% increase over the last two years! I know inflation has been high, but this is crazy stuff. Inflation has never been 20%.

And why? Well, according to the Financial Post the usual culprits are to blame: the COVID pandemic, supply chain issues (particularly, the acute shortage of semiconductor chips), the war in Ukraine and the resulting increase in energy and other prices, yada yada. Although they may not seem directly connected to car prices, and may even seem like old news, taken together they have had a huge and ongoing inpact. 

Add to this the fact that vehicles are becoming more and more complex and electronic, requiring more expensive parts and more skilled labour, that low inventories of vehicles allow dealerships to charge a premium, and the disruption and extra costs associated with the  transition to the manufacture of electric vehicles, and we have all the ingredients for a perfect storm.