New vehicle prices and inventory remained stable in October, even as a six-week United Auto Workers strike disrupted Detroit-Three manufacturing and cost the industry billions in revenue.
According to Cox Automotive, average new vehicle prices saw only slight shifts in October, falling 1.4% from the previous year but gaining less than 1% from September 2023. The movement, or lack thereof, coincided with the UAW strike, which lasted until the month’s final week. However, while there was some concern that the union’s battle with the Big-Three would create shortages and undo months of improving affordability, the retail automotive sector appears to have been insulated from any collateral impact.
Nevertheless, new vehicle prices remain below their peak in the post-pandemic economy and have fallen 3.5% since the start of the year. OEM incentives, which rose 117% year-over-year last month, have contributed to this trend. Tesla was the only automaker to significantly divert from its path, raising prices by 5% on average in October. Until now, the electric vehicle brand has been offering heavy discounts across its lineup in an effort to boost demand. Rebecca Rydzewski, research manager at Cox Automotive, noted that the changes “showcase just how dynamic pricing can be with a direct-to-consumer sales model.”
While affordability is improving, albeit slowly, new vehicle prices remain well above pre-pandemic norms. The only models to sell in October with a sub-$20,000 average transaction price were the Kia Rio and Mitsubishi Mirage, both of which are scheduled for discontinuation.