Average personal income in the United States for those over 25 years of age was $32K in 2005.
A solid rule of thumb is to not spend over 25% of your annual income on a new car purchase, which means the average person should be buying an $8,000 car.
First of all, they do not even sell new cars for $8,000 so you already looking at the used market. Don't be fooled though, $8,000 is plenty to buy yourself a great used vehicle that will last thousands of miles if you know how to buy a used car (only from the original or second owner, no used car lots/dealerships, all service records, and a good eye).
Second of all, the average new car sold in the United States is around $30,000, which means the average car buyer should be making $120,000/year.
Wait, what? So, pretty much the majority of the country are brainwashed by consumerism into thinking they need an expensive new car which they can just finance for 6 or 7 years.
It was very common(up until the housing bubble) to have families with two brand new financed cars which the payments exceeded their mortgage payment.
Raising gas prices has worked wonders for the auto industry too, tricking people with sort commutes and cars with decent but not horrendous fuel economy into spending $20,000+ for a more fuel efficient vehicle when it will probably take years and thousands of miles before they start to break even.