With gas prices near $2 per gallon and auto sales accelerating over the last couple of years, it’s no surprise that the prices consumers are paying for new vehicles are also setting new highs.
The estimated average transaction price for new cars and light trucks in the United States was $34,367 in December 2014, according to analysts at Kelley Blue Book. This is the highest month on record for average transaction prices, KBB says.
New-car prices have increased by $842 (up 2.5 percent) from December 2013, while jumping $556 (1.6 percent) from last month. A growing component of these transactions are for the compact to medium-size segments of sport utility vehicles (SUVs). The hottest SUV market is made up of compact and subcompact SUVs. Such vehicles have gone from just 7 percent of the overall vehicle market in 2007 to 12.4 percent today, says KBB.
“Pricing is strong across most of the industry with the exception of the hybrid/alternative energy segment, which dropped 1.2 percent as gas prices hit a five-year low,” said Alec Gutierrez, senior analyst for Kelley Blue Book. “Lower gas prices will further help the market for trucks and utilities, which are traditionally popular in December.”
Among brands benefitting from the strength in trucks and utility vehicles is Fiat Chrysler, with transaction prices up 2.3 percent on strong RAM sales, and pricing on Dodge vehicles. Dodge average transaction prices were up 6.8 percent after the discontinuation of the discount mid-size Avenger sedan. In addition, Challenger, now including the 707-horsepower SRT Hellcat model, is up 15.4 percent.
“Another notable automaker is Hyundai Kia with the biggest percentage gain of the major manufacturers at 5.5 percent,” said Tim Fleming, analyst for Kelley Blue Book. “The Hyundai brand was up 6.8 percent, helped by the Sonata, which brought the model’s average up 6.1 percent to $26,046. Kia average transaction prices were up 3.1 percent, highlighted by a 16.7 increase from the recently redesigned Sedona minivan.”