The $25k car is going extinct?

You can still buy a new subcompact car (like a Renault Clio or Skoda Fabia) in Europe for under 20k EUR.

The more interesting question is why these cars disappeared in the US. And while many of the factors discussed here are true for both EU and US (inflation, interest rates, manufacturer profit margins etc) I am surprised no one mentioned the 'SUV loophole' of US regulations that effectively boosted the SUVs (off-road vehicles are classified as non-passenger automobiles with everything that entails, notably much less stringent emission standards) and made the small cars unprofitable to make in comparison.

> I am surprised no one mentioned the 'SUV loophole' of US regulations that effectively boosted the SUVs (off-road vehicles are classified as non-passenger automobiles with everything that entails, notably much less stringent emission standards) and made the small cars unprofitable to make in comparison.

This has become the irrelevant part because "does it have an electric motor in the powertrain" has become more important to fuel economy than vehicle size. There are hybrid SUVs that get better MPG than non-hybrid sedans, to say nothing of the full electric ones.

Which is another reason the average price is increasing. Hybrids have a lower TCO even though they have a higher initial purchase price. People who can do the math realize that paying more up front for a hybrid or full electric is paying less long-term. But then the market for lower priced new cars declines, because the people who can afford a new car can afford to pay a little extra for long-term savings and most of the people who can't afford to do that were buying used to begin with.

>Hybrids have a lower TCO even though they have a higher initial purchase price.

Is this conclusion based just on fuel consumption? From a relatability standpoint, it doesn’t make sense at first blush because you have to have both ICE and EV parts in series in the drivetrain; the total reliability can’t be higher than the individual components of they’re in series.

Depending on the drive trains being compared, the hybrid drivetrain may be overall mechanically simpler than an ICE. A series hybrid can easily have fewer moving parts, fewer friction spots, less reliance on fluid motion through little channels, etc.

And then you're also keeping the moving parts more in their happy zone of temperature, speed, and load instead of needing them to operate in as wide of conditions.

Could you elaborate further?

A hybrid, by definition, combines an ICE and electric drivetrain. While I understand it could be designed for a more efficient range of operation* how could it negate the downsides of an ICE-only design if it requires an ICE? (Are we conflating EV and hybrid?)

* This also means each segment is less globally efficient, meaning the system is less efficient if it has to limp along if one part is inoperable