FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives: Domestic Automakers Footed 77% of April's $3.6B Bill but Captured Only 56% of April Market Share
SANTA MONICA, Calif. — May 4, 2005 — Edmunds.com, the premier online resource for automotive information, reported today that the average manufacturer automotive incentive in the United States was $2,434 per vehicle sold in April 2005, up $67, or 2.8%, from April 2004, and down $121, or 4.7%, from March 2005.
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.
The industry's aggregate incentives spending bill totaled $3.6 billion in April. Domestic manufacturers spent $2.8 billion, or 77%, of the total cost; Japanese manufacturers spent $528 million, or 14%; European manufacturers spent $178 million, or 5%; and Korean manufacturers spent $128 million, or 4%.
Overall, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates averaged $3,339 per vehicle sold in April, down $133 from March 2005. Average domestic incentives have never been higher in any prior April. This month, Chrysler became the biggest spender by increasing incentives spending $28 to $3,535 per vehicle sold. At the same time, its market share increased by 0.2%, up to 13.8%. Ford decreased incentives spending by $78 to $2,986 per vehicle sold in April while its market share decreased by 0.6% to 17.3%. General Motors decreased incentives spending by $255 to $3,477 per vehicle sold while its market dropped by 1.4% to 25.0%. The combined market share of the Big Three reached an historic low of 56.1% in April 2005.
From March to April, European automakers decreased incentives spending by $48 to $1,919 per vehicle sold and increased its market share .05%, up to 6.2%. Japanese automakers decreased incentives spending by $45 to average $1,065 per vehicle sold and gained 0.9% market share, climbing to an all-time high: 33% of the U.S. market. Korean automakers increased incentives spending by $148 to $1,885 per vehicle sold and gained 0.4% market share to a total of 4.5%.
Comparing all brands in April, Mini spent only $14 on incentives, while Scion spent $136 and Porsche spent $161 per vehicle sold. At the other end of the spectrum, Lincoln was the biggest spender at $5,284, followed by Cadillac at $5,063 and Jaguar at $4,113 per vehicle sold. Looking at incentives expenditures as a percentage of MSRP for each brand, Pontiac spent the most, 15.4%, while Mini and Porsche spent the least, 0.1%.and 0.2%, respectively.
Among vehicle segments, large SUVs continued to have the highest average incentives, $4,352 per vehicle sold, while sports cars had the lowest average incentives per vehicle at $93. Looking at incentives expenditures as a percentage of MSRP for each segment, large cars were the highest, 11.1%, while sports cars were the lowest, 3.2%.
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.com Information Solutions and is licensed to third parties. For example, the company supplies content for the auto sections of NYTimes.com, AOL, About.com, iVillage.com and IGN.com, provides weekly data to Automotive News and delivers monthly data reports to Wall Street analysts. Edmunds.com also publishes a high-speed, on-screen car magazine called Inside Line available free at www.insideline.com. 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, Calif. and maintains a satellite office outside Detroit.