In 1956, the average Cadillac sold for about $5,000. By 1966, it was about $6,000. In those days, Cadillac was the largest in the luxury car field, the German brands were not even ripples in the American market. Today, however, a BMW 535i stickers, without options, at over $50,000. The 750i, with no options, is over $76,500.
But the inflation rate since 1966 has been about 535%. That means that the $6,000 car of 1966 would cost less than $40,000 today, actually a bit over $38,000. But that kind of money today will get you a 3 Series, or a C Class, which in today’s market is a smaller, mid-priced car.
Sure, there’s a lot more equipment on the current luxury BMW than there was on the 1966 Cadillac. But that’s true of the market in general and has been for decades: considering engineering improvements and equipment enhancements, the price of a typical Ford didn’t rise at all during the sixties. The BMW holds the same relative position in the market today as did the Cadillac in 1966. But, in constant dollar terms, the sticker price is much more.
And the trend keeps going up.
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