U.S. new-vehicle prices reached their highest level of the year in July, even as the sales pace softened and consumers increasingly favoured lower-priced segments.
Kelley Blue Book, a Cox Automotive brand, reported an average transaction price (ATP) of $49,855, up 1.9 per cent from a year earlier and 0.2 per cent from June. Prices remained below the record $50,612 reached in December 2025.
U.S new-vehicle sales declined 1.5 per cent year over year and were largely unchanged from June. The sales mix helped restrain overall price growth, with subcompact SUVs, compact cars and mid-size cars recording year-over-year sales gains while full-size pickups, full-size SUVs and several luxury segments were softer.
Sticker prices also increased annually. The average MSRP reached $51,621, up 1.9 per cent year over year, although it declined 0.1 per cent from June.
Incentive spending moved in the opposite direction, falling for a second consecutive month to 6.4 per cent of ATP from seven per cent in June and 7.3 per cent a year earlier.
“While incentive spending eased in July, that’s only part of the pricing story. We’re also seeing more 2027 model-year vehicles arrive on dealer lots, bringing fresh content, feature updates and higher sticker prices into the market. Consumers continue to gravitate toward more affordable segments, which is helping keep overall transaction price growth in check, but the steady flow of newer vehicles is providing some upward pressure on both ATPs and MSRPs.”
EV pricing strengthened as incentives retreated. The average EV transaction price increased 1.6 per cent year over year to $56,126, ending six consecutive months of annual declines. EV incentives fell 24.3 per cent from a year earlier to $6,626.
