The average new car buyer in America paid $48,247 in November — down 1.5% from this time last year. Prices rose $311 from October’s total. But November was the third consecutive month that cars were less expensive than a year ago.
That marks the only time in the last decade that the average new-vehicle price has gone three months without rising year-over-year.
Advertised discounts, historically low since early in the COVID-19 pandemic, get some credit.
The average non-luxury car sold for $44,417. Discounts made up 5% of the average sale price, up from 4.9% last month. Non-luxury incentives are low by historical standards but at their highest point since September 2021.
For comparison, non-luxury incentive packages averaged 10.5% of the average sale in November 2019.
Dealers Worried
Improving incentives are good news for new car shoppers, but they make dealers nervous. Kelley Blue Book’s parent company, Cox Automotive, recently surveyed dealers and found them deeply pessimistic about the current market and the short-term future of their businesses.
“While consumers may feel some relief in vehicle prices and incentives as we close out 2023, automakers and dealers are feeling the results of the downward price pressure,” said Rebecca Rydzewski, research manager at Cox Automotive.
Of the 35 brands that Kelley Blue Book included in its November analysis, 16 had year-over-year price declines in November, with the largest declines recorded for Tesla (-20.5%), Buick (-6.4%), Land Rover (-6.0%) and Nissan (-5.7%). The largest year-over-year transaction-price increases came from Dodge (11.2%), Ram (10.5%), Audi (7.8%), and GMC (7.8%).
Record Number Bought Luxury Cars
More than one in five car shoppers in November drove home a luxury car — the first time the figure has ever topped 20%.
Incentives helped that happen.
The average price paid for a luxury vehicle in November was $63,235 — down 7.5% from last November. Discounts made up 5.8% of the average transaction — higher than the figure for non-luxury cars.
Tesla, Buick, Land Rover, Volvo, and Acura had the largest price declines last month among luxury brands in the Kelley Blue Book database.
EV Price Parity Approaching
The average price paid for a new electric vehicle in November was $52,345 — about $4,000 more than the average new car’s price and almost $11,000 lower than the average luxury car.
“In recent months, price parity between EVs and ICE has almost seemed possible,” added Stephanie Valdez-Streaty, director of Strategic Planning at Cox Automotive. “It is a complicated measure with plenty of variables, but newer products and higher discounts have brought down average EV prices, even before potential tax incentives. A year ago, the EV premium was more than 30%. Today, it’s less than 10%.”
