After months of new-vehicle transaction prices in the United States holding above the average MSRP, prices are now trending down.
That is according to data released by Kelley Blue Book, which found that the average price consumers paid dropped to $378 below the sticker price. A year ago, the average transaction price for a new vehicle in the U.S. was $600 above MSRP.
“New-vehicle transaction prices are trending downward in 2023, which should feel like a breath of fresh air to buyers following the last few years of low supply and rapidly rising prices,” said Rebecca Rydzewski, Research Manager of Economic and Industry Insights for Cox Automotive, in a statement.
April 2023 new vehicle transaction prices were up 3.7% ($1,744) compared to a year ago, but down month-over-month by 0.03% ($14) from an “upwardly revised March reading” of $48,289. For the first time in nearly a year, luxury vehicle transaction prices dropped below $65,000, while the average transaction price for electric vehicles also fell — to almost $55,000.
Meanwhile, OEM incentive spending reached its highest level in the last year, averaging $1,714 or 3.6% of the average transaction price in April.
“Now that inventory levels are starting to climb and manufacturers are increasing incentives, the market will respond accordingly,” she added. “High auto loan interest rates are still a major issue for many buyers, but inventory and price trends are a positive in the market right now.”