Record-Breaking Prices Steer the Market
September has proven to be a pivotal month for car buyers in the U.S. as the average price of new vehicles has crossed the $50,000 threshold for the first time ever, according to recent insights from Kelley Blue Book (KBB). With prices steadily climbing for more than a year, the summer months accelerated the pace, and yet, Americans continue to drive off the lots with their new rides. How’s that for optimism?
Luxury Models and EVs Fuel the Surge
The record average transaction price (ATP) is partly attributable to the increasing sales of luxury models and electric vehicles (EVs). In fact, EVs accounted for an impressive 11.6% of all new vehicle sales last month—another record high. These electrifying machines came with an average selling price of $58,124, which marked a 3.5% uptick from August. Talk about charging into the future!
Incentives and Market Trends
Despite rising prices, it’s noteworthy that government-backed EV incentives are still providing a cushion for buyers, averaging about ,900 per vehicle in September. Although this is a slight decline from August, it’s a boost compared to last year’s 13%. Tesla remains at the forefront of EV sales, seeing an average ATP of $54,138 this past month. As new standard models of the Model 3 and Model Y emerge, we may see a downward shift in prices. Erin Keating, executive analyst at Cox Automotive, suggests the market is “ripe for disruption.” So buckle up—today’s market is inflationary, reminding us that car prices tend to only trend upwards over time.
