FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives: European Automakers Increase Incentives Yet Lose Market Share
SANTA MONICA, Calif. — (March 2, 2005) — Edmunds.com, the premier online resource for automotive information, reported today that the average manufacturer automotive incentive in the United States was $2,369 per vehicle sold in February 2005, down $90, or 3.7%, from February 2004, and down $39, or 1.6%, from January 2005.
Edmunds.com's monthly True Cost of IncentivesSM (TCISM) report takes into account all of the automakers' 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 averaged $3,161 per vehicle sold in February, down $125 from January 2005, and gained market share, increasing from 57.0% to 57.6% of the total U.S. market. Chrysler increased incentives spending by $122 to $3,307 per vehicle sold in February and gained 0.9% market share, capturing 14.9% of the U.S. market, the highest since February 2001. In February Ford decreased incentives by $158 to $2,675 per vehicle sold — the fifth consecutive monthly decrease — and grew its market share by 1.5% to 18.8%. General Motors decreased incentives spending by $228 to $3,420 per vehicle sold in February, while its market share dropped by 1.7% to 24.0%, a record low.
In February, Korean automakers increased incentives spending by $50 to an average of $1,617 per vehicle sold, and gained 0.3% market share, reaching 4.4% of the U.S. market. European automakers increased incentives spending by $173 to average $1,989 per vehicle sold, and lost 0.4% market share, falling to 6.0% of the U.S. market, the lowest total since February 2001. Japanese automakers decreased incentives spending by $30 to average $1,049 per vehicle sold in February, and lost 0.4% market share, dropping to 31.9% of the U.S. market.
Comparing all brands, in February Mini spent the least on incentives, $21, while Porsche spent only $78 and Scion spent $116 per vehicle sold. At the other end of the spectrum, Lincoln was the biggest spender at $5,513 in February, followed by Jaguar at $4,657 and Cadillac at $4,599 per vehicle sold. Looking at incentives expenditures as a percentage of MSRP for each brand, Pontiac spent the most, 14.6%, while Porsche and Mini each spent the least, 0.1%.
Among vehicle segments, large SUVs had the highest average incentives, $4,120 per vehicle sold, while sports cars had the lowest average incentives per vehicle, $920. Looking at incentives expenditures as a percentage of MSRP for each segment, midsize cars were the highest at 10.2%, while sports cars were the lowest at 3.2%. Midsize SUVs have lost the most market share since February 2004, decreasing from 12.6% to 11.7%. Large cars have gained the most market share during that period, up from 5.0% to 6.3% of the new vehicle market.
About Edmunds.com True Cost of IncentivesSM (TCISM)
Edmunds.com's TCISM is a comprehensive monthly report that measures automobile automakers' 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 automakers' 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 automakers 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.