For years after the pandemic settled in, new vehicle pricing was on the rise – even reaching new record highs on multiple occasions. Thankfully, with inventory increasing exponentially, prices have begun to cool – but only slightly. In fact, through the first few months of 2024, new vehicle average transaction pricing has been on a bit of a roller coaster ride, increasing some months and decreasing others. In May, the Ford brand saw its ATP decline by a mere 0.7 percent, while Lincoln’s was completely flat. As a whole, Ford Motor Company ATP saw a slight decrease, too.
In April, Ford Motor Company average transaction pricing came in at $56,976 – 5.4 percent higher than March, when it was $54,245. This result was also 3.8 percent higher than April 2023, when FoMoCo’s ATP finished the month at $55,104. According to new data from Cox Automotive, FoMoCo’s average transaction pricing dropped by 0.7 percent month-over-month, however, closing out May at $56,595 – a dollar difference of $381, and also 0.2 percent lower than May 2023’s figure of $56,719. As for the overall market, May’s ATP came in at $48,389, which is essentially flat versus April 2024’s figure of $48,368 and 0.9 percent less than May 2023’s $48,830.
Regardless, this marks eight consecutive months that new vehicle ATP has declined, a trend that’s largely driven by increasing inventory and higher incentive spending. The average new-vehicle incentive in May came in at 6.7 percent of the average transaction price, which is the highest level since May 2021 and far higher than the 4.0 percent they accounted for one year ago. Meanwhile, new vehicle inventory kicked off the month at 2.84 million units, which is 51 percent more than May 2023 and the highest since late 2020, all of which helped boost sales as well.
“In May, we saw some positive news on the sales front,” said Erin Keating, executive analyst for Cox Automotive. “A lot of those sales gains were juiced by higher incentives and lower prices, which is good news for consumers worrying about inflation. While there are a lot of vehicles transacting at very high prices, that doesn’t mean all new vehicles are unaffordable. There are still plenty of excellent, well-priced vehicles out there, particularly in the compact segments.”
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