According to the latest data from Cox Automotive’s Kelley Blue Book, the average new-vehicle prices continued to climb for the fourth consecutive month, with the average almost reaching a historical all-time high from December 2022.
Typically, the average transaction price (ATP) for a new vehicle peaks in December, when higher-priced models from luxury brands tend to sell well. However, the new-vehicle ATP in December was unexpected, landing at $49,740, an increase of 1.3% year-over-year and 1.5% compared to November 2024.
Cox Automotive Executive Analyst Erin Keating highlighted that December saw an unprecedented surge in sales volume and prices. A combination of post-election relief, lower interest rates, and increased consumer confidence played a prominent role in dictating consumer behavior.
The average incentive package for new vehicles remained essentially unchanged from November, landing at an average of $3,958 or 8% of ATP. However, it was 44% higher compared to December 2023, primarily driven by the recovery from inventory shortages.
Volkswagen, Ram, and Nissan offered the most significant incentives among all automakers, offering discounts of over 13% of ATP. Toyota, Land Rover, and Porsche were the least generous, and their incentives ranked the lowest in the industry.
As expected, electric vehicles sold well in December, and the ATP rose. The average transaction price rose to $55,544, a 0.8% uptick year-over-year and a 1.1% increase month-over-month.
Incentives for EVs averaged 14.3% of ATP, down marginally from 14.7% in November.
However, incentive packages for EVs remained high in efforts to accelerate consumer adoption and averaged more than $6,700 per sale. These generous incentive packages aided the industry in achieving a record sales volume of 1.3 million last year.
