- New car prices fell 0.4 percent in September, bringing the average transaction cost to $48,397.
- More good news for buyers came in the form of increased incentives, Cox Automotive data shows.
- Despite industry-average prices falling, the Mitsubishi Mirage was the only car with an average transaction price of less than $20k.
New cars are, surprisingly, a bit more affordable this year compared to 2023. So say the analysts at Kelley Blue Book, whose latest data reveals that average transaction prices were down this September when measured against the same month last year. A modest decline, sure, but given the relentless march of inflation, it’s a shift that buyers will appreciate.
The average transaction price of a new vehicle last month stood at $48,397, 0.4 percent lower than the previous September’s. Automakers aren’t hacking down MSRPs, but they do have more inventory, and the greater availability of vehicles is giving buyers more bargaining power.
Related: Mitsubishi’s Q3 Sales Surge 42% With Mirage Soaring 152%
American drivers are also increasingly choosing smaller, less expensive vehicles, KBB says, that shift surely a response to factors including the steep cost of car loans due to high interest rates. Only one vehicle had an ATP of less than $20,000, however. That’s the Mitsubishi Mirage, which unfortunately was discontinued for 2025.
A greater appetite for smaller cars comes at the expense of demand of bigger ones. Full-size trucks’ share of the market is down this year, and sales of mid-size SUVs slipped 5 percent in Q3, according to KBB’s data.
The average transaction price of an electric car was also down, in this case by 0.9 percent. But that’s done little to change the affordability gap between EVs and ICE cars. The ATP for EVs stood at $56,351 in September, 16 percent higher than the average of all vehicle types.
Dealers and automakers have also been increasing the size of the financial incentives they use to persuade customers to sign on the dotted line. KBB says the average incentive package enjoyed its third consecutive monthly rise in September, reaching 7.3 percent of the transaction price (equivalent to $3,522). The average incentive 12 months earlier was only 4.8 percent of the ATP.
For those in the market for an EV, the discounts are even juicier, with incentives averaging 12.3 percent, or $6,094. However, that number is down 5.9 percent from August, which was an unusually great month to snag an electric deal. Perhaps September buyers missed out, but the financial offers are still hefty enough to tempt those on the edge.