New car prices are coming down.but not so much

CNN
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New car prices are coming down. Anyway, a little.

Cars still sell for more than the manufacturer’s sticker price on average, analysts say, but they’re at least getting close to it, analysts say. Also, many car brands are now selling for less than list price. This used to be the norm, but has become rare here for him over a year.

According to Edmunds.com analyst Ivan Drury, new car prices have averaged $700 above the manufacturer’s suggested retail price (MSRP) in the first six months of the year. However, prices have averaged about $230 against MSRP over the past few months, according to Edmonds.

That said, some car brands are still aiming for more. Land Rover models sell on average $4,500 more than list price, while Kia models sell for about $1,600 more than list price. According to Edmunds.com data, Honda averages about $1,360 above the suggested retail price.

Analysts at Cox Automotive say buyers of mainstream, non-luxury vehicles generally tend to pay more than buyers of luxury vehicles. Luxury car buyers, who make up about 17% of the market, still pay higher prices overall, but overall he spends $66,000 compared to $44,000 on average for non-luxury brands. is. Cox spokesman Marc Schirmer said the slight difference in price markups often reflects the fact that non-luxury vehicles have similar features and features to luxury vehicles. It is said that there is a sexuality. Dealers are now only requiring customers to pay for what the product actually delivers, rather than the lower price dictated by the manufacturer. They may be less aggressive in pricing than mainstream dealers, he added.

Overall, Cox’s auto price analyst shows that buyers are spending $527 more on stickers on average. That’s higher than Edmunds’ claim, but lower than earlier this year. (The differences relate to analytical methods and specific data sources, according to spokespeople from both companies.)

Dealers requiring customers to pay more than the car’s list price are usually considered unusual and only for particularly desirable or hard-to-find models such as high-performance sports cars. But according to Cox Automotive, over the past 17 months, vehicle inventory shortages have pushed auto dealers up prices above suggested retail prices. Unlike most things, car prices are usually individually negotiated by dealers leading to wide price flexibility. The slowdown in manufacturing caused by the

Some manufacturers, such as Ford and Honda, have found that customers are willing to accommodate low inventories, high prices, and long wait times to get their cars. Executives at these companies say they have no intention of returning to the days when dealer lots were full of cars and SUVs waiting to be sold.

Vehicle inventories are at their highest level since June 2021, although still tight, especially for some manufacturers like Honda, Cox said.

Cox Automotive’s Rebecca Rydzewski said:

Some large SUVs, such as the Lincoln Navigator and Volvo XC90, sell for relatively steep discounts, averaging $1,400 and $1,900 below sticker, according to Edmunds. According to Edmunds’ data, Volvo and Lincoln are his two car brands that generally offer the biggest discounts off the manufacturer’s suggested retail price. Cox says Buick is another of his brands that offers pretty big discounts.

When it comes to new car loans, Drury says customers can now get pretty good interest rates on short-term loans of 36 to 48 months. Of course, these shorter loan terms come with higher monthly payments, but they have the advantage of saving buyers thousands of dollars in interest, especially if interest rates are rising. It is expected to raise interest rates, which could push up interest rates on things like auto loans. A person’s credit rating has the most impact on how much a car lender charges, but there are still good loan deals for those who qualify, according to Bankrate.com. A Cox Automotive report found a spike in 0% interest offers earlier this month.

Used car prices have also started to come down a bit, Drury said, which could bring new car buyers back into the market.

“Consumers who have been sitting on the sidelines for trade-in value to rise will start to feel the need to act if they want to get the maximum trade-in value out of their vehicles,” he said. rice field.

Cox Automotive analyst Brian Finkelmeyer wrote in a recent report that inflation and higher gas prices will make owners of cheaper, more fuel-efficient models get the best value in trade-ins. However, those who trade in larger, more expensive vehicles may be disappointed.

“National used car inventories are now ballooning with expensive used cars in excess of $35,000,” he wrote.

Edmunds’ Drury says it will be a long time before shopping returns to what it used to be, with buyers now able to negotiate big discounts on most vehicles. That won’t happen until the end of 2023, or until 2024, he said.