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Ever wondered why the allure of an affordable new truck seems more like a mirage these days? Despite the lot inventories of best-sellers skyrocketing far beyond the norms of a healthy market, securing an affordably priced new truck has become tougher than ever.
So, what’s behind this paradox? The answer lies in the automakers’ strategic drift from the production of affordable base models. But, is this strategy set to steer the truck industry into troubled waters? Let’s uncover the truth using CarEdge and MarketCheck’s latest data on the state of the truck market in 2023.
Disappearing Base Models Send Prices Climbing
There’s an interesting trend that the top-selling trucks in America all share: as the total production figures rebounded from pandemic lows, the production of affordable base models hasn’t kept pace. The strategic move by automakers to limit the production of entry-level models has created scarcity, contributing to their increased prices.
Ram 1500: An Extreme Example
Focusing on one of the best-selling trucks in America, the Ram 1500, CarEdge Data reveals that there are 53,652 new Ram 1500s on sale across the nation. However, the most affordable trim option, the Ram 1500 Tradesman, only makes up a mere 3,445 of this total. Despite having a starting price of just $37,090, the Tradesman, as a result, seems like a near-mythical entity in dealer lots.
The scarcity of base model Ram 1500s isn’t the only issue; the prices of these scarce models have surged as the supply diminished. The Ram 1500 Classic witnessed a 26% price hike from 2019 to 2023, while its inventory dropped by a whopping 88%.
Sadly, the trend isn’t exclusive to Stellantis. Both the F-150 XL and the Chevrolet Silverado Work Truck have also followed the same downward trajectory in their base models’ production:
The Silverado 1500 Work Truck experienced a 41% price increase since 2019, even though its inventory has decreased by 33% over the same period. Today, the base model Work Truck represents a meager 6% of the 67,795 brand-new Silverados available on the market.
Gauging the Impact
Despite the combined U.S. sales of America’s three top-selling trucks rising by 2.5% from the pre-pandemic norms of Q1 2020, the inventory of base models like the F-150 XL sits at just 54% of the pre-pandemic levels.
Here’s a look at how overall truck sales (across all trims) has risen back from pandemic lows, despite leaving affordable base trims behind:
Similarly, the Silverado Work Truck is at a mere 49% of early 2020’s inventory. The worst hit is the Ram 1500 Classic, languishing at 23% of January 2020’s inventory, notwithstanding the overall Ram 1500 sales recovering to 91% of the pre-pandemic levels.
The picture is clear: truck inventories have fully recovered from the inventory woes of 2021, but affordable base models were largely left out of the picture. The result: truck buyers are pushed towards more expensive truck options, feeding into the ultimate goal of the automakers – ever higher profits.
The Wider Impact Beyond Trucks
From skyrocketing destination charges to the elimination of popular base models, it’s apparent that automakers are leaving no stone unturned in their bid to maximize profits from each sale. However, this aggressive strategy has not been left unchecked. Consumers are pushing back, sparking significant changes in the industry. A classic example is Honda, which, within a year of canceling the base LX trim for the CR-V and Civic, reversed their decision due to consumer pressure. Kia, too, had to reintroduce its most affordable EV6 after initially discontinuing it.
The real question now is, will truck lovers follow suit and make their voices heard? And more importantly, will the major automakers – Ford, GM, and Stellantis – heed the call, or continue their current strategy, potentially alienating millions of middle-class loyal customers?
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As 2023 model year lineups were announced last year, a sizable portion of the automotive industry faced widespread criticism for eliminating their most affordable vehicles from the lineup. At a time when new car prices were running away from the middle class, the most affordable versions of popular cars were sacked.
Now, in 2024, car manufacturers are reversing course. Are we about to see the resurrection of affordable cars? Or are we getting our hopes up too soon? Let’s take a look at where we’ve been, where things stand today, and where we’re headed as new car sales continue through yet another volatile year.
Goodbye Affordable Base Models?
You could say Tesla started it all when they axed the much-hyped $35,000 version of the Model 3 years ago. However, legacy automakers are a different animal entirely, so we’ll fast forward to 2022. Late last year, Honda led the charge with changes to their product lineup, and were soon followed by Kia and Jeep. Within months, multiple base models were discontinued in the United States, sending entry-level prices through the roof overnight for some of the most popular cars in America.
This was no small move. Together, these manufacturers account for 30% of new car sales in the U.S. The effects were swift and significant, leading to an outcry among car buyers, and as one Kia representative put it, ‘unprecedented demand’ for what had previously been seen as unwanted, unpopular base trims.
Automakers cited lower sales numbers and the supply chain woes of 2021-2022 when explaining the abrupt decision. However, in doing so, they overlooked the crucial role these base models play in catering to the needs of lower-income and budget-conscious drivers. Without affordable base models, a large chunk of the market would be priced out, and would simply take their business to used car lots.
Fast forward to 2024, and some of these same automakers are now making a U-turn, resurrecting their affordable vehicles. The most shocking reversal comes from none other than…. Honda.
Honda’s About-face
Honda ruffled feathers when it eliminated the most affordable Honda Civic, the LX base model, in late 2022. This decision followed an earlier price hike between $1,000 – $2,000 for the 2023 model year. Consequently, budget-conscious commuters, the heart of Honda’s fanbase, were left reeling just as interest rates climbed higher. Further compounding the issue, the CR-V, America’s #2 best-selling SUV, also lost its base trim.
As the base trims were dropped, the entry-level price for the Civic increased from $22,350 to just north of $25,000 for the EX. For the CR-V, the base price jumped by almost $5,000 overnight to $31,610.
The rationale behind these decisions might have been an attempt to boost profits amidst supply chain issues that had plagued Honda since 2021. However, by mid-2022, the automaker’s US sales had plummeted 50% year-over-year.
Now, Honda seems to be having a change of heart. In response to decreasing new car prices and slowed sales, the company has announced the return of the more affordable CR-V in 2024. The CR-V LX, without a sunroof, power-adjustable driver’s seat, and with just a single climate control zone, now lists for $28,410 plus a $1,295 destination fee.
Kia’s Flip-Flop
Around the same time as Honda’s controversial move, Kia also announced the cancellation of the most affordable version of its popular electric car, the Kia EV6. This caused the base price of the EV6 to soar by $7,300, or 18%, to nearly $49,000. Furthermore, the beloved gas-powered Kia K5 also lost its LX base trim, pushing the entry price to $26,195.
Kia, once known for affordability, seemed to be pushing further into premium territory.
However, 2023 and 2024 have seen Kia backtrack somewhat, albeit with certain conditions. The automaker is now offering the EV6 Light in select western US states. The EV6 Light has even returned to Kia’s online configurator.
We call this a win for consumers, especially considering that Kia’s EVs lost the federal EV tax credit this year due to the Made in (North) America requirement.
As far as the Kia K5, the entry-level LX trim has yet to return. The K5 now starts at $26,515 with destination fees. For reference, the 2019 Kia Optima started at $23,915, or 11 percent less than today’s K5.
Jeep Is In Serious Trouble
There’s a 399 day supply of Jeep Renegades nationwide, according to the car buying tools available through CarEdge Insights. This didn’t happen overnight. Jeep’s inventory has been building for months. In fact, every Jeep model has over 100 day’s supply, far above the industry’s healthy standard of 60 days.
You would have thought that Jeep’s parent company Stellantis would have seen the writing on the wall, and perhaps even would have considered lowering prices or introducing incentives.
What we got was the complete opposite. The boxy, poor-selling and unreliable Jeep Renegade lost its Sport base trim for the 2023 and 2024 model years. What happened next? Jeep’s inventory just kept on climbing, and now leads the industry for number of cars on the lot.
In the past five years, new car prices have risen by a staggering 37%. However, there seems to be a light at the end of the tunnel. Our own analysis reveals that automakers who have hiked prices the most are paying the price in the form of WAY too much inventory. See for yourself in the graph below showing how much inventory is on the lot for top-selling models that received price hikes this year.
When it comes to the car market, we’re no stranger to the ups and downs. Get ready for yet another market adjustment, according to at least one group of experts.
A report by industry analysts at AlixPartners forecasts a steady decline in new car transaction prices over the next few years.
By 2025, the analysts expect the average transaction price to decline to around $42,000, down from where it stands today near $46,000.
What do they expect to drive this downward trend in prices? The dynamics don’t “mean the price of the same vehicle comes down,” Mark Wakefield, global co-leader of the automotive & industrial practice at AlixPartners, said at a press conference. “The predominant driver of that is mix shift and trim shift within a product to reduce the higher, more profitable vehicles and get more volume out.”
In other words, it looks like automakers are coming to their senses (at least somewhat) and are planning to make higher numbers of lower-trim vehicles at more accessible price points.
You CAN Negotiate, No Matter the MSRP
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The automotive industry has always been subject to economic trends and shifting consumer preferences. However, the last five years have been a whirlwind of unprecedented change. Across the new car market, average transaction prices have increased by 34% from Q4 2019 to Q4 2024. The average selling price for a new car now stands at $49,740. But some automakers seem to have thrown caution to the wind, pushing their prices far higher. Here’s a look at car price inflation over the last five years, from the highs of the market to the last vestiges of affordability.
Hyundai and Kia Prices Jump 36% in 5 Years
Leading the pack in price hikes is the Hyundai Motor Group, which includes Hyundai, Kia, and Genesis in the United States. The average transaction price for Hyundai Motor Group has increased by 36% from Q4 2019 to Q4 2024, which is quite a bit higher than the overall economy’s inflation (23.0%) over the same period.
Honda prices increased by 35% from 2019 to 2024 as MSRPs increased and buyers showed increasing preference for larger SUVs. But make no mistake: Honda prices have risen. Honda’s best-seller, the CR-V crossover, saw base MSRPs jump from $25,345 in 2019 to $31,450 in 2025.
Stellantis and Toyota are next in line, each with 31% price inflation from 2019 to 2024. Every mainstream car brand except Nissan, Subaru, and Mazda exceeded the overall rate of inflation over the past five years.
The notable difference between Stellantis brands and other leaders like Honda, Hyundai, and Toyota is in sales trends. While Stellantis has fallen sharply, Hyundai, Kia, Honda, and Toyota have steadily risen in both sales and market share.
Subaru, Nissan and Mazda Prices Increased the Least
Contrasting the trend, Subaru seems to have taken a different strategy. With a five-year transaction price increase of ‘only’ 14%, well below the pace of overall inflation during the period. Subaru has managed to maintain an upward trajectory in terms of market share. This gain, paired with standard offerings like all-wheel drive, could be a testament to the importance of price competitiveness in the industry.
Nissan, on the other hand, has likely seen less price increases for a different reason. Nissan has been losing U.S. market share for years as Toyota, Honda, Hyundai, and Kia win over budget shoppers. When demand falls, dealer markups and MSRPs soften. Since 2019, Nissan transaction prices have risen 19%. And now, one of the most popular and least expensive models, the Altima, has been discontinued after three decades.
Mazda prices increased by only 20% from 2019 to 2024, even as the more expensive CX-70 and CX-90 joined the lineup.
Luxury Car Prices Have Risen 25%
To the detriment of vehicle affordability, luxury cars are more popular than ever. More drivers are paying over $80,000 for a new car or truck than ever before. Oddly enough, luxury car prices haven’t climbed quite as much over the past half-decade. While mainstream car brands saw prices climb 27%, luxury brands increased by 25% from Q4 2019 to Q4 2024.
Here’s a look at how the ten best-selling luxury brands in America compare. Note that Tesla, which was the luxury sales leader in 2024, is not included due to lack of publicly-available data.
Prices for new Mercedes-Benz, Land Rover, ad Acura cars have risen more drastically compared to their luxury competition. All of these luxury cars now sell for at least $10,000 more than the did just five years prior.
Free Car Buying Help Is Here
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Ever heard the phrase ‘patience is a virtue’? In the world of used car buying, it’s more than just a virtue – it’s a strategy. With recent fluctuations in used car prices, knowing when to dive into the market can be the difference between an okay deal and a fantastic bargain. But when will car prices drop? As it turns out, the answer lies in understanding the data behind the trends. We’ll unpack the latest used car market update to reveal why the smartest buyers might want to play the waiting game.
Wholesale Used Car Prices Are Falling at a Record Pace
The latest numbers from Cox Automotive are making headlines. In June, wholesale used car prices dropped by -4.2%, with an overall decrease of -10.3% compared to the previous year. June’s decrease was an all-time record for the month, and is second only to the pandemic plunge in car prices during April of 2020.
Here’s where some of the headlines are missing the point: the sharpest declines are being seen at wholesale auctions. These are the auctions that the dealers themselves buy from, not where the average consumer will find their next ride. Surely wholesale price trends will be mirrored in retail prices quickly, right? Not so fast.
On the retail side, the used car price decreases have been more modest. Retail used car prices fell by just -0.5% over the last month, revealing an unsurprising mismatch between wholesale and retail trends. Let’s dig a bit deeper into that…
Understanding the Lag Between Wholesale and Retail Prices
But why does this gap between wholesale and retail used car prices exist? Simply put, retail prices typically lag behind wholesale trends. This is due to the time it takes for changes in the wholesale market to trickle down and affect retail prices. Dealers want to squeeze every possible dollar out of their inventory, so it takes a while for market trends to finally be reflected in sticker prices (and negotiability).
Therefore, if you’re planning to buy a used car, it’s likely worth waiting 30, 60, or even 90 days. The drastic declines in wholesale auctions seen today will likely translate to better retail prices in the coming months.
Why not now? Consider the following: We track used car prices weekly here with the help of Black Book. In the graph below, you can clearly see the marginal price movement on the retail side of the market. Retail used car prices in fact remain above where they started 2023.
In this next graph from Black Book, we see the more noteworthy price declines on the wholesale side.
Before you head to the dealership, know this: retail car prices typically lag behind wholesale price trends by one to three months. To save the most on your used car, we recommend waiting 30, 60 or 90 days for retail prices to really come down.
Rushing out to dealer lots today could cost you, as dealers today are very likely to ‘play dumb’ and hold off on lowering prices for as long as they can.
The Impact on Trade-In Values
These changes don’t just affect buyers; they also have significant implications for those looking to sell or trade in their vehicle. The most immediate impact of falling used car prices is a decrease in trade-in values. If you’re certain about selling or trading in your car, it’s wise to complete the sale as soon as possible to get the best value.
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Retail Sales and Used Car Inventory
These price trends come alongside a decrease in retail sales for June and a continued rise in used car inventory. ‘Days supply,’ a common industry metric used to compare inventory while also factoring in the daily sales rate, continues to climb for most used vehicle segments. This means that more cars are available, but they are also staying on the lot longer.
Interestingly, the major vehicle market segments saw their seasonally adjusted prices remain lower year over year in June. Compared to June 2022, pickups and vans have fared better than most, losing 6.6% and 8.5% respectively. Sports cars took the hardest hit at 14.8% year-over-year, while compact cars lost 12.6%, and midsize cars dropped by 12.2%. When compared to last month, all segments were down, with compact and midsize cars experiencing the most significant declines.
The Dealer’s Dilemma: Cash Crunch and Inventory Overload
The rapid fall in used car prices has put car dealerships in a tough spot. Dealers (and their lenders) are under a significant cash crunch. You’re not the only one borrowing money for your next car. Dealers themselves have to pay interest for every day a car sits unsold on their lot, creating a time-is-money dilemma. Car dealerships typically take out loans to purchase inventory at auction, and then pay interest on that loan until the car is sold. This hidden expense is called ‘floorplanning costs’, and they’re rising for dealers in a time of interest rate hikes.
They desperately want to make the most money possible from the sale of each car on their lot. This is their path to profits. However, quickly-changing market dynamics are throwing a wrench in their plans. As used car values fall quickly, dealers are finding themselves in a precarious situation.
Used Cars with the Most Inventory Today
Using the market analysis tools available through CarEdge Data, we identified the ten mainstream used cars with the MOST inventory today. These are the used cars that you’re more likely to negotiate a better deal with today.
In the weeks and months ahead, we fully expect to see more models reaching over 100 days supply on the used car market. Electric vehicles and trucks are piling up on dealer lots as we speak!
Used Cars with the Least Inventory Today
Negotiating will be tougher with these models in short supply. Note that this list is full of vans and SUVs. These family haulers remain in demand, but the good news is that van and SUV prices have fallen more than the overall market average in recent months. Follow our weekly used car price updates here.
While the current market might seem chaotic, let’s not forget that “patience is a virtue”. As we’ve seen, smart car buyers will benefit significantly from holding off for the next 30 to 90 days. This brief period of waiting will yield better deals and greatly increased negotiability as dealers become eager to offload their inventory. It’s not about being lucky – it’s about being patient and strategic.
To navigate the changing used car market, consider getting expert help from CarEdge. Our CarEdge Data plan provides you with up-to-date, behind-the-scenes market insights that can help you seize the best opportunities. Featuring the latest Black Book vehicle valuations, CarEdge Fair Price and official recommendation for every listing, and three CarEdge Reports per month, you’ll have the tools you need to secure a great deal.
Likewise, a CarEdge Coach can guide you through the process, ensuring you’re equipped with the knowledge and confidence to make the most out of your car buying experience.
Remember, the savviest of car buyers follow the data, not the headlines. Stay patient, stay informed, and get ready to snag that excellent deal on your dream used car soon!
Jeep sales are slipping in 2024. Yes, the brand known for all-terrain traction is having a really hard time keeping up in today’s new car market. Inventory is piling up, 2023 models remain unsold, and yet, prices are soaring higher than ever. It seems that Jeep has plunged headlong into a sales crisis, leaving their brand new vehicles gathering dust on dealer lots.
At CarEdge, we’re all about empowering car buyers to take control of their deal. If you’re in the market for a new or used Jeep, you won’t want to miss this one. For the savvy Jeep fan, major savings could be on the horizon. Let’s dive in.
Jeep Inventory: Why It Matters
Inventory is the lifeblood of the car industry, and Jeep is no exception. An abundance of cars on the lot can indicate slow sales, creating an environment where buyers could potentially nab themselves an attractive deal. Simply put, it’s a buyer’s market when there’s too much inventory. That’s generally the case for any product, but it’s especially true for automakers as 2024 models pile on to dealer lots.
Jeep Inventory Is Through the Roof
This year, however, it appears that Jeep has been having a hard time selling their cars. 2024 model-year inventory is through the roof, and last year’s cars are still in need of an owner. It’s amazing how much 2023 inventory Jeep still needs to sell, with nearly 48,000 new 2023 models on dealer lots nationwide. Shockingly, Jeep still has 2,000 new 2022 models that remain unsold.
But let’s look deeper into the data. The Market Day Supply (MDS), the measure of how long it would take to sell all current inventory at the current sales rate, can provide critical insights into the state of sales. Right now, Jeep’s MDS dominates the list of the new cars with the most inventory. This is an alarming sign that Jeeps are spending far too much time on lots before finding a home.
Here’s a quick breakdown of every Jeep model’s inventory:
Make
Model (New 2023)
Market Day Supply
Nationwide Inventory
It’s clear that the Renegade, Cherokee, Compass, Gladiator and Grand Wagoneer are struggling the most with high MDS and large amounts of inventory still unsold, but they’re not outliers. All Jeep models aside from the Wrangler Unlimited have over 100 day supply right now.
In the auto industry, a market day supply of 60 to 70 days is considered ‘healthy’. Jeep’s inventory has a high fever right now, and the only remedy is to sell cars soon.
For comparison’s sake, here are the ten new car models with the highest inventory right now.
Make
Model
Market Day Supply
Average Transaction Price
Total For Sale
Total Sold (45 Days)
Still not convinced it’s that bad? Here are the new cars with the lowest inventory. Note that this list is the result of both high sales volumes AND low production numbers for some automakers.
Make
Model
Market Day Supply
Average Transaction Price
Total For Sale
Total Sold (45 Days)
Stellantis, Where Are the Incentives?!
Despite these alarming figures, Stellantis, the parent company of Jeep, remains undeterred. In fact, it appears that they are doubling down on their strategy of ‘price high, hope for the best’. The average transaction price for a Jeep is now $53,913. For the first time ever, Jeep buyers are more likely to pay luxury prices than anything remotely resembling the sub-$40,000 prices of yesteryear.
And Stellantis is all-in on luxury pricing. The critically-acclaimed Jeep Grand Wagoneer starts with an MSRP north of $60,000, with most on the lot going for well over $75,000. A quick glance at CarEdge Car Search shows that even a humble Wrangler Unlimited is likely to cost you north of $50,000. See for yourself.
When it comes to an automaker’s #1 way to sell cars, Stellantis seems to be neglecting the Jeep brand. That would be incentives. Or in Jeep’s case, the lack thereof.
We track manufacturer incentives monthly, and it couldn’t be more clear that Jeep’s parent company is in no hurry to move inventory. Despite dominating the Top 10 list for the most inventory, Jeep is nowhere to be seen on thelist of best incentives this month. You’d think there would be a correlation there. Not so!
Dealers Make Matters Worse
To make matters worse, Jeep dealers have become notorious for making customers jump through hoops to get a fair price. We’ve recently seen $100,000+ Jeeps, and an abundance of bait and switch dealer pricing.
Here’s one of many examples that car buyers have shared on the CarEdge Community Forum. This Jeep dealer in Florida adds several thousand dollars in pointless fees to the already sky-high sticker price:
On top of the B.S. ‘Naples Advantage’ fee, there’s a $1,198 doc fee. That’s because Florida is one of the only states that doesn’t put a limit on doc fees, and dealers love taking advantage of that. Yup, over $1,000 to ‘file the paperwork’.
It is abundantly clear that Jeep dealer pricing is reliant on unaware, unsavvy car buyers who will pay the sticker price without hesitation. Fortunately, the car buyer in this example was a CarEdge member, and knew how to push back against B.S. dealer ripoffs.
This reliance on consumers’ lack of awareness doesn’t just reflect poorly on the dealers – it’s a black mark on Jeep itself. Jeep, it’s time to take better care of your customers!
Harness the Power of Data to Negotiate Jeeps Today
Unlike car buyers in decades past, you now have a powerful tool at your disposal: information. Knowledge is power in negotiation, and these high inventory numbers reveal a potentially golden opportunity. For the prepared and knowledgeable buyer, Jeeps will become increasingly negotiable in 2024. But as we’ve seen, don’t expect dealers to be giving out great deals. You’ll almost certainly have to work for it.
Our CarEdge Car Coaches understand this and are ready to help you save thousands on your next vehicle. They know that the first step in getting a good deal is understanding the market conditions. Our team of experts is ready to help you identify savings opportunities, no matter what new or used car you’re in the market for.
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In summary, be savvy, do your research, and don’t be afraid to walk away if the deal isn’t right. It’s a great time to be a Jeep buyer—if you know what you’re doing. Dealers might be playing hardball, but you can play the game too. And now, you have the data to back you up.