In December 2021, the average transaction price for a new vehicle in America reached $47,077. Prices hit record highs over the year 2021, while sales were low.
Last year was distinguished by an unprecedented price increase in the car market. According to Kelley Blue Book, the year ended at a mark of almost $47,100 for a new vehicle in the USA. That was the average transaction price in December. In November, by the way, it was $46,329.
The average new car cost rose by $6,220 in 2021. For comparison: the figure was $1,799 in 2019 and $3,301 in 2020. Prices also were climbing in the used car market and reached an average of more than $27,500 in December.
Last year, demand outpaced supply on the automotive market because of the COVID 19-related problems automakers have faced: global microchip shortage, shutdowns and supply chain breakdowns.
Americans were ready to spend money on a new car, but the lack of inventory motivated dealers to set prices higher than MSRP (manufacturer’s suggested retail price), and they did not compete with each other through incentives.
Incentives in December 2021, for example, sat near a five-year low. It was difficult to find a discount on any new vehicle. Incentives made up just 3.9 percent of the average sale.
At the same time, sales in the luxury car segment increased: the average transaction price was a record-setting $64,864 last month ($1,300 above the sticker price). On the contrary, affordable sedans made up a small percentage of sales (record-low 22.7 percent in December).