The average transaction price in September was $48,397, down 0.4% from last year, but Mitsubishi’s budget-friendly Mirage has been discontinued
Surprisingly, new cars are slightly more affordable this year than in 2023. According to analysts at Kelley Blue Book, the latest data shows that average transaction prices dropped this September compared to the same month last year. Though the decline is modest, it’s a welcome change for buyers amid the ongoing rise of inflation.
Last month, the average transaction price for a new vehicle was $48,397, 0.4% lower than in September of the previous year. While automakers aren’t slashing MSRPs, increased inventory is giving buyers more leverage in negotiations.
According to KBB, more American drivers are opting for smaller, more affordable vehicles—a likely response to the high cost of car loans driven by rising interest rates. However, only one model had an average transaction price (ATP) under $20,000: the Mitsubishi Mirage, which has been discontinued for 2025.
This growing preference for smaller cars is impacting demand for larger vehicles. Full-size trucks have seen a decline in market share, and mid-size SUV sales dropped 5% in Q3, based on KBB data.
The ATP for electric vehicles (EVs) also decreased by 0.9%, but the price gap between EVs and internal combustion engine (ICE) cars remains wide. In September, the ATP for EVs was $56,351, about 16% higher than the average for all vehicle types.
Dealers and automakers have been boosting financial incentives to encourage buyers. According to KBB, the average incentive package rose for the third straight month in September, reaching 7.3% of the transaction price, or $3,522. A year earlier, incentives averaged just 4.8% of the ATP.
For EV shoppers, the discounts are even more generous, with incentives averaging 12.3%, or $6,094. Although this figure is down 5.9% from August, which saw exceptional deals on EVs, September still offered substantial savings for those considering a purchase.
