No, safety and fuel regulations did not send prices of cars into the stratosphere. In the 1960's suburbs of Philadelphia, gas was 30 cents a gallon, a nice new car was $3k, the house cost $30k, and Dad made $10k as a VP of engineering at a small firm. Right now, all three are almost exactly 10x what they were then; so cars have not gone up more than regular inflation.

And, to top it off, today's car reliability is way, way higher, as is the quality (in the 60's, we were thrilled if a car lasted 6 years and got 80k miles; nowadays, that's about half of what you'd expect. And the safety is wildly improved (like, for instance, air bags, never mind seat belts!)