New-Vehicle Prices Moving Little
As the ATP of new vehicles has moved little over the past year, more consumers are opting for the least pricey models, including the Hyundai Elantra.
Incentives and more affordable models are helping keep new-vehicle prices in check, though they’re not falling appreciably and certainly nowhere near prepandemic levels.
As the third quarter ended last month, the average transaction price totaled $48,397, according to Cox Automotive data. That was essentially flat – down by less than a half percent – both month-over-month and year-over-year.
Even average incentive spending barely budged – up just one-tenth of a percent from August to 7.3% of the ATP, though well up from 4.8% a year earlier, Cox said.
Given the stubbornness of vehicle prices themselves despite revived inventories, incentive spend is still propping up sales volume, said Executive Analyst Erin Keating. New-vehicle supply measured in early September hit 2.8 million units, up from about 2.1 million a year earlier, Cox said.
“We still believe there is potential for growth in the market for the rest of the year, she said, “but with the uncertainty of a national election around the corner and major weather events disrupting business, maybe a slow, steady pace is all we should expect.”
Many consumers are opting for the most affordable price points in the market this year, including those around $25,000, Cox said. Only one model, the Mitsubishi Mirage, was selling for less than $20,000. Expensive vehicles, such as full-size pickups, are consequently losing market share.
“The subcompact and compact SUV segments are outperforming the market this year, and by no coincidence, they’re also two of the lowest-priced product segments in the market,” said Cox Senior Economist Charlie Chesbrough.