2004 Model Year Vehicles Average Over $1500 Incentives Per Vehicle; Domestics Spend a Record High While Market Share Drops to Historic Low
FOR IMMEDIATE RELEASE
Edmunds.com Reports Automakers' True Cost of Incentives: 2004 Model Year Vehicles Average Over $1500 Incentives Per Vehicle; Domestics Spend a Record High While Market Share Drops to Historic Low
Santa Monica, CA - September 30, 2003 - Edmunds.com, the premier online resource for automotive information, reported today that the average manufacturer incentive per vehicle sold in the United States was $2,630 in August 2003, up $524 or 24.9% from August 2002 and down 1.4% from July 2003.
"The decline from July is caused by the sales-weighted averaging of 2003 and 2004 model year vehicles, and reflects the higher level of sales of 2004 model year vehicles in the more recent month. Incentives for 2003 model year vehicles averaged $2,842 - up $36 for the month - while 2004 models averaged a lower, but remarkable, $1,547 - up $89 for the month," stated Dr. Jane Liu, Executive Director of Data Analysis for Edmunds.com.
Edmunds.com's monthly True Cost of IncentivesSM (TCISM) report takes into account all of the manufacturers' various United States incentives programs, including subvented interest rates and lease programs as well as cash rebates to consumers and dealers. To ensure the greatest possible accuracy, Edmunds.com bases its calculations on sales volume, including the mix of vehicle makes and models for each month, as well as on the proportion of vehicles for which each type of incentive was used.
Incentives spending for domestic Chrysler, Ford and General Motors nameplates hit a record high of $3,687 per unit in August, compared to $1,752 for European automakers, $1,484 for Korean automakers, and $1,032 for Japanese automakers.
Despite the increased incentives spending by the domestic manufacturers, their market share declined to an historic low of 57.6%. In August, Ford's incentives spending went up by 2.8% to $3,472 per unit while its market share dropped 0.6% to 17.5%. General Motors' incentives spending per vehicle went over the $4,000 mark for the first time in August, up 1.4% to $4,025 per unit, while its market share declined 1.3% to 28.4%. Chrysler increased its incentives spending by 0.7% to $3,193 but saw its market share decline 0.1% to 11.7% in August.
Among vehicle segments, large SUVs had the highest average incentives last month at $4,166, followed by vans at $3,597 and large cars at $3,536. Sports cars had the lowest average incentives at $1,124, followed by luxury SUVs at $1,599 and compact SUVs at $1,619. Large trucks have gained the most market share since August 2002, up 2.1% to 14.1%, while compact cars have lost the most market share during that period, down 2% to 14.2%.
Industry average 'days-to-turn,' which measures how many days on average it takes to sell a vehicle after it hits the dealer's lot, reached a record level of 74 days in August, compared to 61 days last August. Mitsubishi had the longest days-to-turn at 132, followed by Saturn at 109. The quickest inventory turnaround was for Mini, at 18 days, followed by Lexus at 28 days.
About Edmunds.com True Cost of IncentivesSM (TCISM)
Edmunds.com's TCISM is a comprehensive monthly report that measures automobile manufacturers' cost of incentives on vehicles sold in the United States. These costs are reported on a per vehicle basis for the industry as a whole, for each manufacturer, for each make sold by each manufacturer and for each model of each make. TCI covers all aspects of manufacturers' various incentives programs (except volume and similar bonus programs), including dealer cash, manufacturer rebates and consumer savings from subvented APR and lease programs (including subvented lease residual values used in manufacturer leasing programs). Data for the industry, the manufacturers and the makes are derived using weighted averages and are based on actual monthly sales and financing activity.
About Edmunds.com, Inc.
Edmunds.com is the premier online resource for automotive information. Its comprehensive set of data, tools and services, including Edmunds.com True Market Value® pricing, is generated by Edmunds Data Services and is licensed to third parties. For example, the company supplies over 800,000 pages of content for AOL's auto channel and NYTimes.com's auto section and delivers monthly data reports to Wall Street analysts. Edmunds.com was named "best car research" site by Forbes ASAP, is viewed by consumers as the "most useful Web site" according to the J.D. Power and Associates New Autoshopper.com StudiesSM for both 2001 and 2002, and was ranked first in the Survey of Car-Shopping Web Sites as reported by The Wall Street Journal. The company is headquartered in Santa Monica, California and maintains a satellite office in Troy, Michigan.