Average New Car Nears $39,000

By Staff Writer June 08, 2020
The share of pickup trucks has spiked recently, reaching an all-time high in April. 2020 Chevrolet Colorado The share of pickup trucks has spiked recently, reaching an all-time high in April. 2020 Chevrolet Colorado

The valuation analysts at Kelley Blue Book reported the estimated average transaction price for a light vehicle in the United States was $38,940 in May 2020. New-vehicle prices increased $1,618 (up 4.3 percent) from May 2019, while prices dropped $244 (down 0.6 percent) from last month.   

Hyundai saw some of the biggest gains for manufacturers this year. The Hyundai Venue Ultimate 2020
Hyundai saw some of the biggest gains, up 13%. 2020 Hyundai Venue 

“Though new-car sales will be down significantly for the third month in a row, due to the COVID-19 pandemic, average transaction prices have actually strengthened over this period for several reasons,” said Tim Fleming, analyst for Kelley Blue Book. “Incentives, deferred payments, and low APR deals are helping consumers stretch out their monthly payments over longer terms. Inventory levels have tightened as the economic recovery has begun, but little new supply has arrived yet from the factories that restarted in May. Finally, the share of pickup trucks has spiked recently, reaching an all-time high in April.”

These factors all contributed to the 4 percent increase in transaction prices in May 2020; however, gains at these levels are not sustainable, analysts stated. If factories are slow to restart and new-vehicle inventories remain low, manufacturers will pare back their incentives, placing pressure on new-vehicle prices. KBB added that while trucks have been remarkably resilient, their big spike in market share was the result of sales losses in mid-size cars, compact SUVs and minivans.

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Last modified on Monday, 08 June 2020 14:45

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