IRVINE, Calif. — On average, consumers are paying $500 less for a new vehicle today vs. a year ago, according to Kelley Blue Book. The most significant year-over-year declines are for vehicles offered by Japanese brands, specifically those that were severely impacted by inventory shortages stemming from Japan’s major earthquake in 2011.
Low inventory levels are no longer suppressing new-vehicle sales as supply is meeting demand. As a result, transaction prices, or Kelley Blue Book Fair Purchase Prices (the price consumers typically are paying for a car based on actual new-vehicle transactions and updated weekly for changing market conditions), are considerably more affordable than this time last year.
“The average Honda model is selling for nearly $1,200 less than this time last year, and a Subaru, Mazda or Toyota is approximately $700 to $800 more affordable. Toyota and Honda have regained 4.5 and 2 percentage points of market share, respectively, through May 2012,” said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. “Compare this to the average year-over-year declines of less than $500 for Ford, Chrysler and General Motors, and it’s no wonder the Japanese automakers have been able to considerably increase market share this year.”
Although the average year-over-year drop in Kelley Blue Book Fair Purchase Price for new cars is sizable, there are a handful of models that are particularly affordable. The 2012 Toyota Prius is down $2,500 year-over-year, while the 2012 Honda Accord and 2012 Nissan Sentra are down nearly $1,500. Although it dropped $2,500 from this time last year, the Toyota Prius still sells at 95 percent of its original manufacturer’s suggested retail price (MSRP).
In June 2011, the Prius was selling at nearly 10 percent more than MSRP due to high fuel prices and nonexistent inventory. These two issues no longer are driving up prices for the Prius and other fuel-efficient models.
“The Honda Accord and Nissan Sentra can attribute their price decline to improved inventory levels, falling fuel prices and the expectation of a redesign for each model later this year,” said Gutierrez. “Although conditions in the global economy continue to deteriorate, consumers who are willing to pull the trigger on a new vehicle will find that there are plenty of deals available.”
For more information, visit www.kbb.com.