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For the seventh month in a row, prices for new vehicles jumped, hitting a new all-time high in October. According to a new report from Kelley Blue Book, Cox Automotive reported that at $ 46,036, the average transaction price for a new vehicle was up 12.9%, or $ 5,266, from October 2020. prices are also up 2%, or $ 910, from September. .
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The inventory of new vehicles is well below normal levels. Chip shortages and supply chain issues have led the global auto industry to produce 1.5 to 5 million fewer vehicles this year than initially expected, the Washington Post reported. Automakers are using microchips available in high-end and higher margin products, according to Cox Automotive. Luxury buyers paid an average of $ 61,020 for a new vehicle last month.
The average new vehicle also sells for 2% above the Manufacturer’s Suggested Retail Price, or MSRP, in October. That means buyers paid an average of $ 800 more than the sticker price last month, Cox Automotive noted. In October 2019, buyers were paying about $ 2,300 less than the MSRP.
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Each brand has also reduced its inventive spending month after month. “As the average transaction price hit a new high, the average incentive package fell to its lowest level in 20 years,” said Kayla Reynolds, analyst at Cox Automotive. “To brand a new vehicle, buyers accept prices without haggling, with significant market adjustments in some cases. It’s absolutely a seller’s market right now.
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Looking ahead, Kelley Blue Book sees little relief from high new vehicle prices as supply is expected to remain tight in the first half of 2022. Automakers will also continue to focus on high income products. and move away from more affordable sedans.
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