In September, the average American buying a new car got a 7.2% discount, thanks to incentives automakers and dealerships use to attract new buyers. In October, the average discount was 7.7%.
The average final sale price of a new car rose slightly, ending the month at $48,623 — $226 higher than last month’s average. Fluctuations have been that small for months. For more than a year now, new-vehicle prices in the U.S. have remained mostly unchanged and near $48,500.
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New vehicle incentives have increased by over 60% since one year ago.
Automakers offer discounts because some have too many cars to sell.
“’Tis the season for automakers to make their final push for 2024 sales,” said Cox Automotive Executive Analyst Erin Keating. “While some automakers focus on managing production, many will likely maintain or even increase their seasonal incentives to attract buyers. With competition intensifying, these strategies will be crucial in maintaining market share and driving end-of-year sales. Our team is generally optimistic for new-vehicle sales to close out the year – extra incentives will certainly help.”
Before the COVID-19 pandemic, automakers routinely discounted the average car sale by 10%. Some automakers are back to that level. Stellantis brands, including Chrysler, Dodge, Jeep, and Ram, have been drastically over-supplied for much of the year. All four Stellantis brands had average incentive packages of over 10% in October as they worked to clear the inventory glut.
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The top three vehicle segments — compact SUVs, midsize SUVs, and full-size trucks — routinely account for more than 45% of all vehicle sales. However, competitive price pressures caused them to move in different directions in October.
Full-size pickup trucks, where sales have been relatively soft in 2024, saw year-over-year sales prices lower in October by 1.3%, settling at $65,389. The average pickup buyer got a discount of 8.7%
The average transaction price for compact SUVs remained mostly flat year over year, at $36,769. Buyers averaged a 9.4% discount.
Midsize SUV prices increased, but by less than 1.0%, ending the month at $48,977, with incentives making up 8% of the average sale price.
Electric vehicles (EVs) continued a price slide, selling for $56,902 — $678 lower than in September. The average incentive package offered on an EV, including estimates for government incentives when applicable, was 13.7% of ATP, up from 11.6% in September and more than double the level seen one year ago.