Ford Exec Says New Car Pricing Will Slightly Drop In 2024

March 8, 2024 11:52 am

New car pricing has surged to new record heights for years now, buoyed by dwindling inventory levels and high demand amid various supply chain shortages and resulting production issues. However, inventory levels have steadily increased as of late, and continue to inch back toward pre-pandemic levels. This has also placed downward pressure on new car pricing at the same time, which has declined slightly over the past several months. As Ford CFO John Lawler noted during the automaker’s Q4 2023 earnings call with investors, that trend is expected to continue through 2024, too.

“Our 2024 outlook also assumes a flat-to-slightly higher SAAR (seasonally adjusted annual rate) in both the U.S. and Europe, and our planning assumption for the U.S. is 16 million to 16.5 million units,” Lawler said. “Non-recurrence of the UAW strike, full year of our all-new Super Duty driving both positive pricing and mix in Ford Pro, industry supply, and demand normalizing. Now from a planning perspective, we are assuming lower industry pricing of roughly two percent, driven by higher incentive spending as we move through the year. We expect this to be partially offset by top line growth from the launch of our new products.”

Two percent is a rather modest drop in new car pricing, but it also aligns with recent trends. Early last year, Ford CEO Jim Farley predicted that new vehicle prices would fall slightly in 2023, by around five percent – which later came true. In fact, this past January, Ford Motor Company average transaction pricing declined from $55,035 to $53,755 – 2.3 percent lower than the month prior – which was also 5.3 percent less than January 2023, when it was $56,751.

Slowing sales and improving inventory levels – coupled with increased incentive spending – figure to keep this trend going through 2024, though we seemingly won’t see any sort of massive price drop related to new vehicles. In fact, Edmunds recently noted that it expects new vehicle sales will remain relatively level throughout the upcoming year, too.

We’ll have more on new vehicle pricing soon, so be sure and subscribe to Ford Authority for comprehensive Ford news coverage.

By Brett Foote

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.