FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives; Chrysler Remains Highest Spender
Santa Monica, CA - March 16, 2004 - Edmunds.com, the premier online resource for automotive information, reported today that the average manufacturer incentive per vehicle sold in the United States was $2,459 in February 2004, up $324, or 15.2%, from February 2003, and up $94, or 4%, from January 2004.
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.
Overall, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates increased by 1.7% to $3,409 per vehicle in February, compared to $3,354 in January. Chrysler spent the most per vehicle for the second month in a row, reaching $3,857 per vehicle, up $6 over the previous month, while gaining 0.45% of market share. General Motors' incentives spending decreased by $29 to $3,450 per vehicle while its market share gained back a portion of the substantial loss incurred in January, climbing by 1% to 27.1%. After declining for four consecutive months, Ford's incentives spending increased by $202 to $3,031 per vehicle in February while its market share increased 0.3% to 19%.
In February Korean automakers spent $1,686, European automakers spent $1,596 and Japanese automakers spent $881 per vehicle sold.
Examining the data by brand, Edmunds.com found that Mini spent virtually nothing on incentives while Scion spent only $66 and Lexus spent only $159 per vehicle. At the other end of the spectrum, Oldsmobile continued to spend the most incentives dollars per vehicle at $5,191, followed by Lincoln at $4,540 and Mercury at $4,314.
Among vehicle segments, large cars had the highest average incentives last month at $3,881, followed by large SUVs at $3,224 and minivans at $3,220. Luxury SUVs had the lowest average incentives at $1,227, followed by luxury sports cars at $1,855 and sport cars at $1,884. Large SUVs gained the most market share since February 2003, increasing from 3.8% to 5.3%, while midsize cars lost the most market share during that period, down from 18% to 16.7%.
Industry average days-to-turn, which measures how many days on average it takes to sell vehicles after they arrive at dealerships, was 69 days in February compared to 64 in both January 2004 and February 2003. Isuzu had the longest days-to-turn at 144, followed by Mitsubishi at 121. The quickest inventory turnaround was for Scion at 13 days, followed by Mini at 23 days.
From January 2004 to February 2004 the Edmunds.com New Vehicle Price Index decreased 1% to 99.7 (base = 100 set in January 2002). From February 2003 to February 2004, the Edmunds.com New Vehicle Price Index has increased by 2% from 97.7 to 99.7. Only a couple of the segments posted gains in February: vans saw the largest increase at 1.9%, followed by large SUVs at 1%. Compact cars had the most significant decline at 2.3%, followed by compact SUVs at 1.7%.
In February 2004, the sales-weighted average new vehicle sticker price was $29,153, 1% lower than in January 2004 but 3.9% higher than in February 2003. The sales-weighted average net price was $24,747 - 15% below MSRP and the highest since September 2003, when the discount from average MSRP to net price was 16%.
The average net price was 19.3% below MSRP for domestic automakers in February, compared to 18.5% in February 2003. Korean manufacturers' average net price was 14.4% below MSRP in February 2004, up from 10.5% the previous year. Japanese manufacturers' average net price was 9% below MSRP in February 2004, unchanged from last year. European manufacturers' average net price was 6.2% below MSRP in February 2004, up slightly from 6% last year.
This data was released today with the Edmunds Price Index for new vehicles (EPI-N), which reflects price shifts for the industry as a whole, and can be analyzed by different market segmentation. Similar to the Consumer Price Index, the EPI-N measures the average changes in retail prices for a fixed basket of new vehicles with fixed options over time for the purpose of trend analysis. Edmunds.com also analyzes transaction prices and net prices by country of origin, manufacturer, make and model, reflecting manufacturer-to-consumer rebates, including low APR and special lease programs.
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 the auto sections of AOL and NYTimes.com, provides weekly data to Automotive News and delivers monthly data reports to Wall Street analysts. Edmunds.com was named "best car research" site by Forbes ASAP, has been selected by consumers as the "most useful Web site" according to every J.D. Power and Associates New Autoshopper.com StudySM 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.