New Cars a Tad More Affordable
May averages show that combined circumstances gave auto consumers slightly better buying power for the month, though average prices were up year-over-year.
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May’s flat new-vehicle prices and consumer income growth offset a small loan interest rate bump, Cox Automotive said.
The average transaction price declined half a percentage point from April to $49,220 as the estimated average auto loan rate inched up eight basis points to 9.5%. Average prices were up 1% year-over-year.
Meanwhile, consumer incomes rose 4% year-over-year, and vehicle purchase incentives were up about 6% to hit 7% of the average transaction price, Cox reported.
The combined conditions meant that the number of weeks of median income necessary to buy the average new vehicle was down 3% year-over-year. Month-over-month, that number fell very slightly from 35.2 to 34.9. That’s down sharply from its December 2022 peak of 42, when monthly new-car payments averaged $795.
On average, consumers committed to monthly car payments of $753 in May. Though down half a percentage point from April, that’s up by about the same amount year-over-year, Cox data shows.
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