As interest rates soar and inventory grows, average transaction pricing for new vehicles has largely fallen in recent months, a phenomenon that also applies to the Ford brand. In fact, Ford ATP dipped by 0.8 percent month-over-month in September to $55,925 before declining by 1.5 percent in October to finish the month out at $54,912. This slow and steady return to pre-pandemic normalcy continued for the Ford brand (not including Lincoln) in the month of November as well, according to new data from Cox Automotive.
Last month, Ford’s average transaction pricing dropped by another modest amount – 0.7 percent – to close out November at $54,525. Perhaps more notable, that figure is also 1.7 percent lower than November 2022, when Ford’s ATP came in at $55,471. These figures also outpaced the overall market, which saw its ATP decline by 0.6 percent month-over-month to $48,247, as well as 1.5 percent year-over-year.
Interestingly, November marks the third consecutive month that new-vehicle transaction prices were lower year over year – as well as the only time in the past decade that the monthly new-vehicle ATP did not increase year-over-year. Cox Automotive attributes this continued decline to a ramp up in incentives, which rose by 136 percent year-over-year to reach 5.2 percent of the average transaction price in November, which more than double last year’s 2.2 percent. However, this isn’t good news for everyone involved in the industry.
“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. “The latest dealer sentiment survey by Cox Automotive clearly indicates that dealers are seeing profits contract as inventory levels return to normal, and incentives are turned up to help stimulate sales.”