With dwindling supply and increased demand, new car prices soared even further in May, representing an all-time high in year-over-year growth for the month. In data compiled and released by Kelley Blue Book, the average new car transaction price was $41,263, an increase of $2,125 or 5.4% over May 2020. It’s also a $493 or 1.2% increase over April 2021.
According to KBB data, every automaker except Tesla (-8.8%) and Nissan (-0.40%) saw average transaction prices rise year over year. All but Ford rose month-over-month from April to May. The biggest gains were enjoyed by Mitsubishi, no doubt buoyed by the competitive all-new Outlander, which jumped 5.6% month-to-month and 12% year-over-year.
The next largest year-over-year increases were the various Stellantis brands (11.3% to $48,093), General Motors (10.9% to $48,544) and Honda (10.7% to $32,564). The Stellantis and GM gains, plus their lofty transaction prices, are no doubt explained by the ever-increasing demand for trucks and large SUVs that command higher prices, plus the decreased incentives available on them as demand outpaced supply.
That said, Ford sells the best-selling truck, the redesigned F-150, and was the only automaker down month-to-month with an average transaction price of $45,802 versus $47,031 in April.
KBB also broke down differences in prices for 23 different vehicle classes. All were up except “high performance car” (down 13.2% to $95,797) and electric vehicles (down 10.8% to $52,486). Although we can’t speculate about “high performance car” as we’re not quite sure which vehicles are classified as such, the drop in electric vehicles year over year can actually be viewed as a good thing. In short, there are more affordable electric vehicles for sale in May 2021 than there were a year ago, buoyed by the new Ford Mustang Mach-E and Volkswagen ID.4. The Tesla Model 3 is no doubt continuing to do its part as well.
It should also be noted that EV prices were actually up 1.9% month-to-month. Of course, every segment was, including the nebulous “high-performance car.” The biggest month-to-month gains were, ironically, on the exact opposite ends of vehicular scale: subcompact car and high-end luxury car. It’s not hard to explain why, though. For subcompact cars, the actual difference in dollars was quite small since their prices are quite low: $19,295 to $20,004. For high-end luxury cars ($101,362 to $105,124), dwindling supplies likely meant that dealers didn’t need to offer the usual heavy discounts on such vehicles. That segment also represented the largest increase by dollars month-to-month as opposed to percentage.
The largest segment increase year-to-year by percentage was for minivans at 15.4% (the all-new Sienna and Carnival no doubt helped on that front), but in terms of differences in dollars, “luxury full-size SUV/crossover” was the biggest gainer at nearly $10,000. Given the transaction price of $98,209, we’re guessing this consists of the Navigator, Escalade, BMW X7 and Mercedes GLS. Their non-luxury counterparts were the second-biggest gainers by dollars at more than $8,000. A new Tahoe and Yukon certainly helped, but again, these vehicles often were subject to large incentives that have since disappeared.