One tactic that OEMs are leveraging in order to offset some of this growth is the use of incentives.
Average new car prices were up 2.1% in November, driven in large part by continued growth in pickup and SUV sales, according to Kelley Blue Book.
One tactic that OEMs are leveraging in order to offset some of this growth is the use of incentives. Incentive use shifted away from cars and more toward SUVs last month, but incentive-to-transaction price ratio remained at 10%, which an analyst at KBB described as a healthy ratio.
Remaining within a healthy incentive-to-transaction price ratio means that the residual of these cars will not be adversely affected down the road when it comes time for resale.
Fiat Chrysler realized the highest growth in average transaction price in November, with a 4.7% increase over the same time last year. Rising sales of the new RAM 1500 pickup and Jeep brand were leading contributors to this increase.
Subaru and American Honda also saw healthy growth at 4.5% and 4.2%, respectively.
Among the manufacturers that KBB tracks, three saw average transaction prices decline: Ford Motor Co., Volkswagen Group and Hyundai-Kia.
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