FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives for April; Prices of Gas-Guzzlers Falling as Gas Prices Rise
SANTA MONICA, Calif. — May 1, 2008 — Edmunds.com, the premier online resource for automotive information, estimated today that the average automotive manufacturer incentive in the U.S. was $2,449 per vehicle sold in April 2008, up $13, or 0.5 percent, from March 2008, and up $39, or 1.6 percent, from April 2007.
"Gas prices are having a profound effect on the psychology of car-buyers, so we expect that automaker and dealer marketing tactics may include free gasoline programs this summer," stated Jesse Toprak, Executive Director of Industry Analysis for Edmunds.com. "As indicated in Edmunds' True Market Value Predictive Alerts (http://www.edmunds.com/tmv/alerts.html), transaction prices of gas-guzzling large SUVs and trucks will likely continue to fall."
Edmunds.com's monthly True Cost of IncentivesSM (TCISM) report takes into account all automakers' various U.S. 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.
According to Edmunds.com, combined incentives spending for domestic manufacturers averaged $3,377 per vehicle sold in April 2008, up from $3,366 in March 2008. From March 2008 to April 2008, European automakers decreased incentives spending by $305 to $2,647 per vehicle sold; Japanese automakers increased incentives spending by $22 to $1,288 per vehicle sold; and Korean automakers decreased incentives spending by $44 to $2,079 per vehicle sold.
|True Cost of Incentives for "Big Six" Automakers|
|Automaker||April 2008||March 2008||April 2007|
"Honda's TCI is an all-time high for the company, but most automakers are doing everything they can to keep incentives down and to keep supply in line with demand in this challenging environment," commented Edmunds' AutoObserver.com Senior Editor Michelle Krebs. "That's why we've seen recent cutbacks in production, especially at General Motors."
In April 2008, the industry's aggregate incentive spending is estimated to have totaled approximately $3.17 billion, down 3.8 percent from March 2008. Chrysler, Ford and General Motors spent an aggregate of $2.1 billion, or 67.2 percent of the total; Japanese manufacturers spent $646 million, or 20.4 percent; European manufacturers spent $261 million, or 8.2 percent; and Korean manufacturers spent $131 million, or 4.1 percent.
Among vehicle segments, large trucks had the highest average incentives, $4,363 per vehicle sold, followed by large SUVs at $4,222. Compact cars had the lowest average incentives per vehicle sold, $1,049, followed by sport cars at $1,277. Analysis of incentives expenditures as a percentage of average sticker price for each segment shows large trucks averaged the highest, 13.5 percent, followed by large cars at 12.6 percent of sticker price. Sport cars averaged the lowest, 4.2 percent, followed by luxury sport cars at 4.8 percent of sticker price.
Comparing all brands (except Isuzu, Mini and Smart), Edmunds.com's research indicates that in April Scion spent the least at $182 followed by Lexus at $770 per vehicle sold. At the other end of the spectrum, Cadillac spent the most, $5,732, followed by Saab at $4,854 per vehicle sold. Relative to their vehicle prices, Jeep and Dodge spent the most, 14.8 percent and 14.5 percent of sticker price, respectively; while Scion spent 1.1 percent and Porsche spent just 1.6 percent.
About Edmunds Inc. (http://www.edmunds.com/about/)
Edmunds Inc. publishes three Web sites that empower, engage and educate automotive consumers and enthusiasts. Edmunds.com, the premier online resource for automotive consumer information, launched in 1995 as the first automotive information Web site. Its most popular feature, the Edmunds.com True Market Value®, is relied upon by millions of people seeking current transaction prices for new and used vehicles. 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 Study(SM), was ranked first in the Survey of Car-Shopping Web Sites by The Wall Street Journal and was rated "#1" in Keynote's study of third-party automotive Web sites. Inside Line launched in January 2005 and is the most-read automotive enthusiast Web site. CarSpace launched in February 2006 and is an automotive lifestyle social networking Web site for anyone with an interest in automobiles. The company is headquartered in Santa Monica, California, and maintains a satellite office in suburban Detroit.