Average transaction prices (ATPs) for all new vehicle purchases
hit $47,148 in May 2022, making it the second most expensive month to buy a new car in history. With ATPs up 13.5% since May 2021, experts warn not to expect a price drop any time soon. According to Kelley Blue Book, new non-luxury vehicles are now selling for approximately $1,000 above MSRP on average. But not all segments of the automotive industry are equally affected by these high prices. Luxury car buyers are in for even higher prices, but electric vehicles (EVs) have seen an overall price drop in recent months.
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Kelley Blue Book has released figures showing average transaction prices for various new vehicle makes in May 2022, April 2022, and May 2021. Based on these numbers, it’s clear that some automakers’ prices are climbing faster than others.
For instance, customers who bought a new Honda
, Mercedes-Benz
, or Land Rover
in May 2022 paid, on average, between6.1% and 9.3% above MSRP. But Buick
and Lincoln
buyers typically paid 1% below MSRP. Climbing prices are a problem for both luxury and non-luxury buyers. In May, the average price of a non-luxury vehicle purchase was $43,338. By comparison, the average luxury new vehicle price was $65,379. Luxury vehicles now sell for $1,071 above sticker price, compared to almost $1,300 under last year.
What’s responsible for the so-called “over-sticker market”? Simply put: low inventory + high demand = price explosion.
Truck prices are climbing faster than others
While EVs have seen some price dips due to new market entries, other segments of the industry are growing fast. An $888 average price increase makes trucks the fastest-climbing segment of the industry with vans close behind at $726.
But there’s good news: the average price to buy a new electric vehicle dropped in May. That’s thanks to the number of affordable new EVs hitting the market—but keep in mind that “affordable” has a slightly different meaning when it comes to electric cars. In fact, the average price to buy a new EV in May 2022 was over $64,000: astonishingly close to the average for luxury car purchases.
The only segment of the industry that saw a significant price decline in May 2022? Passenger cars. Sports cars
, in particular, have seen some serious price drops over the last year: If you’ve been pondering a sports car purchase, this could be your moment!
Should you wait to buy a new car?
While high prices are intimidating, delaying a purchase might not actually mean lower prices. Rebecca Rydzewski, research manager of economic and industry insights for Cox Automotive
, says that while price growth should slow over the summer, “no one should expect price drops, as tight supplies in the new market will hold prices at an elevated level into 2023.” RECOMMENDEDNo spam or unwanted phone calls · No long forms
