4 min read
Data Point
Wednesday October 12, 2022
The average price paid for a new vehicle in the United States in September 2022 was down from August’s record but remains solidly above the $48,000 mark, according to new data released today by Kelley Blue Book, a Cox Automotive company.
The Kelley Blue Book new-vehicle average transaction price (ATP) decreased to $48,094 in September, slightly lower than the previous high of $48,240. September prices dipped 0.3% ($146) month over month from August, but were up 6.1% ($2,775) year over year from September 2021.
NEW-VEHICLE AVERAGE TRANSACTION PRICE
According to Kelley Blue Book calculations, September marks a record 16th straight month that new-vehicle ATPs were higher than the average manufacturer’s suggested retail price (MSRP), also known as the sticker price.
“Interest rates and average monthly payments were up in September, which means affordability worsened,” said Rebecca Rydzewski, research manager of economic and industry insights for Cox Automotive. “With prices still well above MSRP and incentives from automakers still low, sales in September continued to struggle as consumers weighed their vehicle-buying options.”
Average Prices for Luxury Cars Decline Slightly from August
Strong luxury vehicle sales have been a primary reason for overall elevated new-vehicle prices. Luxury vehicle share remains historically high, increasing to 18% of total sales in September from 17.6% in August. The high share of luxury sales is helping to push the overall industry ATP higher.
In September 2022, the average luxury buyer paid $65,775 for a new vehicle, down $60 from August when luxury ATPs hit a record high of $65,835. Buyers continue to pay more than MSRP for new luxury vehicles, although prices are trending closer to or below sticker prices in some luxury segments.
Mercedes-Benz and Jaguar showed the most price strength in the luxury market, transacting between 2% to 4% over sticker price last month. Luxury brands Audi, Alfa Romeo, Infiniti, Lexus, Porsche and Tesla showed the least price strength, selling 1% or more below MSRP in September.
Average Non-Luxury Car Prices See Significant Drop but Remain Above Sticker
The average price paid for a new non-luxury vehicle in September was $44,215, down $256 month over month. On average, car shoppers in the non-luxury segment paid $829 above sticker price, a slight decrease from August.
Most non-luxury brands had stable pricing or declines in September. Buick, Mazda and Dodge showed the most price strength in the non-luxury market, transacting between 2% to 4% over sticker price last month, while Ford, Honda and Toyota showed the least price strength, selling 1% or more below MSRP in September.
PRICE CHANGE PERCENTAGE BY AUTOMAKER
Electric Vehicle Prices Declined in September but Remained Up Compared to One Year Ago
The average price paid for a new electric vehicle (EV) declined in September by $1,162, or down 1.8%, compared to August, but was up by 9.7% compared to a year ago in September 2021. The average new EV price was $65,291, according to Kelley Blue Book estimates, well above the industry average and aligning more with luxury prices versus mainstream prices.
Auto Incentives Offered by Manufacturers Remain Historically Low
Incentives decreased again in September 2022 to only 2.1% of the average transaction price, a record low. One year ago in September 2021, incentives averaged 5.2% of ATP. Full-size cars and luxury cars had the highest incentives in September at 4.4% of ATP. Meanwhile, high-performance cars, vans, electric vehicles and luxury full-size SUVs/crossovers had the lowest incentives, all less than 1% of ATP.
INDUSTRY AVERAGE TRANSACTION PRICE VERSUS INDUSTRY AVERAGE INCENTIVE SPEND AS % OF ATP
Brands with higher inventory levels offered higher incentives in September. For example, the Stellantis brands generally had higher-than-average inventory in September and higher-than-average incentives. While still low from a historical perspective, Stellantis’ incentives in September averaged 4.0% of ATP, down from 4.4% in August.
Sign up here to receive bi-weekly updates on news and trends dominating the automotive industry.
Tags
Related Content
4 min read
Data Point U.S. New-Vehicle Prices Down Year Over Year for Third Straight Month; Market Shifts Toward Buyers as Incentives Climb, Profit Margins Squeezed ATLANTA, Dec. 11, 2023– The U.S. new-vehicle average transaction price in November 2023 was $48,247, an increase of ... Read Article
4 min read
Data Point Auto Credit Availability Worsens Following Three Months of Improvement According to the Dealertrack Auto Credit Availability Index for all types of auto loans, access to auto credit worsened ... Read Article
6 min read
Data Point Wholesale Used-Vehicle Prices Decrease in November Wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) decreased 2.1% in November from October... Read Article
As an automotive industry enthusiast with a comprehensive understanding of market dynamics, I can confidently analyze the information provided in the article dated October 12, 2022. My expertise is rooted in a profound knowledge of the automotive sector, encompassing pricing trends, consumer behavior, and economic factors influencing the market.
The data presented by Kelley Blue Book, a reputable source in the automotive industry, indicates that the average price paid for a new vehicle in the United States in September 2022 was $48,094. Although this figure represented a slight decrease from August's record of $48,240, it remained significantly above the $48,000 mark. Notably, this marked the 16th consecutive month where new-vehicle average transaction prices (ATPs) were higher than the average manufacturer's suggested retail price (MSRP).
Rebecca Rydzewski, the research manager of economic and industry insights for Cox Automotive, highlighted the impact of increasing interest rates and average monthly payments on affordability in September. The higher prices, coupled with low incentives from automakers, led to challenges in vehicle sales as consumers weighed their options.
The article further delves into the dynamics of luxury and non-luxury vehicle segments. Luxury vehicle sales, constituting 18% of total sales in September, played a significant role in elevating overall new-vehicle prices. The average luxury buyer paid $65,775 for a new vehicle, with some brands like Mercedes-Benz and Jaguar transacting above sticker price, while others, such as Audi and Tesla, showed less price strength.
Non-luxury car prices saw a significant drop in September, with an average price of $44,215. Despite this decrease, buyers in this segment still paid on average $829 above sticker price. Variations in price strength were observed among non-luxury brands, with Buick, Mazda, and Dodge exhibiting higher transaction prices over sticker compared to Ford, Honda, and Toyota.
The data also sheds light on the electric vehicle (EV) market, revealing a decline in the average price paid for a new EV in September compared to August. However, the average EV price remained notably higher than the industry average, aligning more with luxury vehicle prices. Auto incentives offered by manufacturers remained historically low, accounting for only 2.1% of the average transaction price in September 2022, a record low compared to 5.2% in September 2021.
The article concludes by highlighting that brands with higher inventory levels, such as Stellantis, offered higher incentives in September. Stellantis' incentives averaged 4.0% of ATP, down from 4.4% in August, emphasizing the impact of inventory levels on incentive offerings.
In summary, the provided data offers a comprehensive overview of the automotive market in September 2022, covering average transaction prices, the influence of luxury and non-luxury segments, electric vehicle pricing, and the historical low in manufacturer incentives.
