In 2024’s car market, we’ll take good news where we can get it. Since 2018, new car prices have soared 32% on average. However, we’re seeing a different trend this spring: falling new car prices. Market-wide, the average transaction price for a new car sold in the U.S. has fallen by 5% since the start of the year. Yet, a closer look depicts a more nuanced picture, with certain brands experiencing significant price drops. Let’s delve into these changes and what they signify for consumers and the industry alike.
New Car Prices Are Falling, For Some More Than Others
Without further ado, take a look at the fresh data below. Then, we’ll dive into the details! I think it’s safe to say that new car prices are falling, regardless of whether or not MSRPs are. (Actually, MSRPs are falling too!)
Our latest analysis, leveraging CarEdge Data, offers a fresh perspective on the pricing strategies of major car manufacturers. Or perhaps this isn’t the result of strategies, but rather the result of months of oversupply combined with high interest rates.
Remarkably, brands like Dodge, Chevrolet, Cadillac, and Ford have seen substantial price reductions. Just how big are we talking? Average selling prices for these brands are down nearly 10% in just three months.
Here’s a look at the data from top-selling makes in America:
| Make | 12-2023 Avg Price | 3-2024 Avg Price | % Price Drop |
|---|---|---|---|
| Dodge | $55,264 | $48,306 | -12.59% |
| Chevrolet | $48,748 | $44,240 | -9.25% |
| Cadillac | $73,239 | $67,636 | -7.65% |
| Ford | $55,614 | $51,526 | -7.35% |
| GMC | $66,706 | $62,154 | -6.82% |
| Jeep | $54,434 | $50,887 | -6.52% |
| Ram | $66,987 | $63,159 | -5.71% |
| Hyundai | $37,308 | $35,310 | -5.36% |
| Nissan | $34,502 | $32,682 | -5.28% |
| Mitsubishi | $31,637 | $30,010 | -5.14% |
| Jaguar | $73,727 | $70,020 | -5.03% |
| Chrysler | $50,621 | $48,134 | -4.91% |
| Mercedes-Benz | $78,165 | $74,741 | -4.38% |
| Buick | $37,661 | $36,066 | -4.24% |
| Audi | $65,355 | $62,826 | -3.87% |
| Lincoln | $65,236 | $62,768 | -3.78% |
| Honda | $36,597 | $35,242 | -3.70% |
| Kia | $35,456 | $34,184 | -3.59% |
| BMW | $71,943 | $69,467 | -3.44% |
| Infiniti | $59,839 | $57,781 | -3.44% |
| Mazda | $35,596 | $34,620 | -2.74% |
| Acura | $51,194 | $50,124 | -2.09% |
| Genesis | $63,604 | $62,380 | -1.92% |
| Subaru | $35,327 | $35,573 | 0.70% |
| Toyota | $38,298 | $39,370 | 2.80% |
Dodge leads with a price drop of over 12%, followed closely by others such as Chevrolet and Ford, which have dropped by more than 7% in a few months. Even Honda, Hyundai, Kia, and Mazda have seen falling prices too. Luxury car prices are down across the board.
The only car brands with rising car prices in 2024? For that, we look to two popular Japanese brands: Toyota and Subaru. With less inventory than most of the overall market (44 days of supply for Toyota, and 86 days of supply for Subaru), it’s not unexpected. At least both of these brands sell cars for well under today’s ridiculously high average price of roughly $47,000.
The Bigger Picture: The Bubble Has Burst!
Zooming out, overall new car price trends indicate a market that is correcting itself after years of steady increases. It’s about time. This change in direction is crucial for consumers seeking an affordable new car, especially as interest rates look to remain high for most if not all of 2024.
How do we know that the new car market’s bubble is bursting?
Consider the following:
- In March 2024, there’s an 80-day supply of new cars on dealer lots. Normally, this figure is closer to 60 days. The oversupply continues to grow.
- Incentive spending is growing: Discounts and incentives in January averaged 5.7% of the selling price, up from 5.5% in December and nearly 100% higher than a year ago.
- Low APR offers are growing in number, despite high interest rates.
- As the data here shows, only two mainstream OEMS have rising selling prices in 2024. On average, transaction prices have fallen 5% this year.
In Conclusion: Prices Will Continue to Fall
Late March is the end of the quarter, and that means dealers and automakers alike are going all-out to sell cars. Come April, some of the best deals will vanish, but not for long. With new car inventory remaining high, there will still be deals in April, just not quite as many zero percent APR offers or great lease deals.
Wondering if you’re getting a good deal? Get behind-the-scenes industry insights with CarEdge Data. See local price and inventory metrics that typically only the dealers have. It’s empowered car buying for all!
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