New-Car Prices Jump

By Staff Writer July 02, 2020

The valuation analysts at Kelley Blue Book reported the estimated average transaction price for a light vehicle in the United States was $38,530 in June 2020. New-vehicle prices increased $1,141 (up 3.1 percent) from June 2019, while rising $160 (up 0.4 percent) from last month.   

“Though Q2 sales are expected to be down 35 percent due to COVID-19 and the ensuing economic recession, transaction prices over this time strengthened more than normal,” said Tim Fleming, analyst for Kelley Blue Book. “The industry average climbed 3 percent– helped by increases in non-luxury cars—and light truck sales mix at around 75 percent of the total market. Today’s new-car buyers are likely more financially secure despite the economic uncertainty, and they are purchasing a disproportionate number of trucks and SUVs. However, buyers are still shying away from luxury brands, which saw prices dip 1.5 percent.”

Supply and inventory challenges remain a concern across many parts of the country and in high-demand segments, due to factory shutdowns this past spring, and slow supply chain ramp-ups since. Along with a recent resurgence in used-car values, this will likely keep prices elevated during the summer months.

Cars continued their comeback, showing improvements of all body styles and averaging 3 percent gains. Compact cars led the way with nearly 4 percent increases, thanks in part to the new Sentra. Mid-size SUVs had the biggest jump of any segment, rising 6 percent on the redesigned Ford Explorer (up 12 percent), Jeep Wrangler (up 5 percent), and the all-new Hyundai Palisade, which sells for $42,516 on average, $2,000 higher than the segment average. Lastly, the mix of SUVs and trucks is still pushing the average new-vehicle price up, with June’s light truck mix expected to be around 76 percent, up from 71 percent one year ago.

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Last modified on Thursday, 02 July 2020 13:59