October's average price of $47,936 was a slight increase from September, but a 1.4% decrease from the same month a year ago.
The automotive market in October witnessed stability in new-vehicle prices in the U.S., with only a minimal increase from the previous month, despite the United Auto Workers (UAW) strike, reported Kelley Blue Book, a Cox Automotive company. The average price for a new vehicle was $47,936, representing a modest rise from September's revised figure of $47,797.
The average new-vehicle transaction prices actually decreased by 1.4% compared to the same period last year, a time when incentives were near historic lows, resulting in a drop of around $670. This trend of declining prices continues, with a year-to-date reduction of more than 3.5%.
Rebecca Rydzewski, research manager at Cox Automotive, highlighted the stability in new-vehicle prices, noting the exception of Tesla. "The only big mover last month was Tesla, which continues to shift pricing at a surprising pace. In fact, the price shifts at Tesla in 2023 showcase just how dynamic pricing can be with a direct-to-consumer sales model," Rydzewski said.
Incentive packages for new vehicles have remained relatively unchanged over the past three months, hovering just under 5% of the average transaction price (ATP). While higher than last year, these incentives are still considered muted by historical standards. Notably, the trend of higher incentives in the luxury vehicle sector reversed in October, with non-luxury incentives averaging 4.9% of ATP, marginally higher than luxury incentives.
The average price for new non-luxury vehicles in October stood at $44,331, a minor increase from last year and a slight decrease from September. This segment saw incentive spends of 4.9% of ATP, a rise from the 2.3% one year ago. Brand-wise, Chevrolet, Chrysler and Dodge saw decreases in incentive levels and a subsequent increase in ATPs in October, while brands like Ford, Jeep and Ram experienced the opposite trend.
Luxury vehicle prices, led by Tesla, marked an increase of $757 from September, setting the average at $62,903. This surge, however, comes after a 7.4% decrease year over year. Tesla, the volume leader in the luxury market, reversed a 10-month trend of declining transaction prices.
The electric vehicle (EV) market also saw an increase in average prices, with the average price paid for a new EV in October being $51,762, up from September's revised $50,326. This increase was primarily driven by price gains in Tesla's Model 3 and Model Y. Despite these gains, average EV prices are still significantly lower than the previous year.
Abby Andrews