
A downward slide in new-vehicle prices through the first quarter of 2024 reversed course in April, with average transaction prices increasing by 2.2% to $48,510, the highest prices since December 2023. The April price estimates were released today by Kelley Blue Book, a Cox Automotive brand. Year over year, new-vehicle transaction prices were lower by 0.5%.
New-vehicle incentive levels retreated last month as well. The average incentive package in April was 6.3% of the average transaction price, according to Kelley Blue Book estimates, down from 6.6% in the prior month. The incentive decline in April was the first decrease since October 2023, when incentive levels ticked lower to 4.7% from 4.8% in September.
Driven partly by fewer selling days, new-vehicle sales volume in April was lower month over month. At 15.7 million in April, the seasonally adjusted annual rate (SAAR) of sales, however, was marginally higher versus March and flat year over year. New-vehicle inventory levels – a key driver of price and incentives – at the start of April were estimated by vAuto, a Cox Automotive brand, to be higher year over year by 46%. Inventory, however, was mostly unchanged month over month, suggesting the rapid increase in available supply has slowed. The increase in available inventory has kept downward pressure on prices and is one reason average transaction prices in April were lower year over year.
“The month-over-month increase in pricing in April is likely just a reflection of some pullback on incentives compared to the end of Q1, in March, when many automakers were pushing discounts to hit a strong finish to the quarter,” said Erin Keating, executive analyst at Cox Automotive. “Still, prices are down year over year. Affordability challenges continue to lurk, and as inventory slowly builds, we can expect to see incentives slowly grow through the remainder of 2024 to help keep any sales momentum alive.”