While new vehicle average transaction pricing largely declined throughout the duration of 2023 following years of setting new record highs, it hasn’t been a straightforward downward spiral. Rather, there have been months of increases scattered among those decreases, but overall, things have certainly been headed in a downward direction. Lincoln average transaction pricing increased by 2.2 percent in October, in fact, and followed that up by dropping a mere 0.7 percent in November. In December, Lincoln ATP remained mostly unchanged and stable as well, according to new data from Cox Automotive, which is notable as the Ford brand ATP increased by 2.2 percent.
Last month, Lincoln ATP increased by 0.8 percent to $67,401, and that figure is also 0.7 percent higher than December 2022, when the luxury brand’s average transaction price was $66,961. The overall new vehicle market actually outpaced that slightly growth, however, with its ATP increasing by 1.3 percent to $48,759, which was also 2.4 percent lower than December 2022, when that same figure came in at $49,939.
On the bright side, Cox Automotive notes that December marks the fourth consecutive month that new-vehicle transaction prices were lower versus last year, which is unique in that the industry typically sees year-over-year increases. This was driven by growth in incentive spending – which reached 5.5 percent of ATP for the first time since August 2021 in the last month of the year – a big jump from the 2.7 percent incentives accounted for in December 2022.
“When we look at price strength, the pandemic created a seller’s market in which new vehicles were transacting above manufacturers’ suggested retail price in 2022,” said Michelle Krebs, executive analyst for Cox Automotive. “That market is all but gone now, as higher inventory has led to higher incentives and discounts – lower margins for dealers – and vehicles are now typically selling for under MSRP. The shift from a seller’s market to a buyer’s market is well underway.”