New Car Prices Creep Back Up After Months of Hibernation – WebTimes

May 14, 2024 | by magnews24.com

The average transaction price of a new car jumped 2.2% last month to $48,510

 New Car Prices Creep Back Up After Months of Hibernation
  • After months of declining, new car prices ticked up last month.
  • The average transaction price was $48,510 in April.
  • Mainstream models now cost an average of $44,989.

New car prices are climbing once again as the average transaction price jumped 2.2% to $48,510 in April. The figure reverses months of declines, but it’s important to note the number is still down 0.5% on a year-over-year basis.

That’s little consolation to buyers and Kelley Blue Book also found new vehicle incentives dipped. In particular, the average incentive in April was 6.3% of the average transaction price and that’s down from 6.6% in March. That being said, incentives have made a significant rebound since 2022 when there was a perfect storm of tight inventories and high demand for new vehicles.

More: New Car Transaction Prices Haven’t Been This Low For Nearly Two Years

Cox Automotive executive analyst Erin Keating said, “The month-over-month increase in pricing in April is likely just a reflection of some pullback on incentives compared to the end of Q1, in March, when many automakers were pushing discounts to hit a strong finish to the quarter.” She added, “Affordability challenges continue to lurk, and as inventory slowly builds, we can expect to see incentives slowly grow through the remainder of 2024 to help keep any sales momentum alive.”

The average transaction price for a mainstream vehicle was $44,989 last month and that’s up from $44,078 in March. The increase was attributed to pricier pickups as the average transaction price for a full-size truck hit $66,631 in April.

 New Car Prices Creep Back Up After Months of Hibernation

At the opposite end of the affordability spectrum, sales of luxury vehicles remained strong despite transaction prices increasing 2.4% last month. As a result, the average transaction price for a luxury vehicle was $64,076.

The biggest winners appear to have been Tesla and Volvo. The former brand saw average transaction prices climb 5.7% but that shouldn’t be surprising as Tesla increased the price of the Model Y by $1,000 on April 1.

Speaking of Tesla, the average electric vehicle transaction price climbed slightly to $55,252. However, that’s down 8.5% on a year-over-year basis “thanks in part to price pressure on EVs driven by slowing sales, healthy inventory, and more competition.” Electric vehicles also have some the highest incentives.

 New Car Prices Creep Back Up After Months of Hibernation

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