FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives for July
SANTA MONICA, Calif. — August 1, 2008 — Edmunds.com, the premier online resource for automotive information, estimated today that the average automotive manufacturer incentive in the U.S. was $2,611 per vehicle sold in July 2008, up $166, or 6.8 percent, from June 2008, and up $90, or 3.6 percent, from July 2007.
"This month we had the highest level of averaged combined incentives in 2008 for both domestic and Japanese automakers," stated Jesse Toprak, Executive Director of Industry Analysis for Edmunds.com. "As domestic automakers start to restrict leasing, we will start to see a decrease in their incentive spending."
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 $3,741 per vehicle sold in July 2008, up from $3,382 in June 2008. From June 2008 to July 2008, European automakers increased incentives spending by $474 to $3,335 per vehicle sold; Japanese automakers increased incentives spending by $5 to $1,394 per vehicle sold; and Korean automakers increased incentives spending by $106 to $2,064 per vehicle sold.
|True Cost of Incentives for "Big Six" Automakers|
|Automaker||July 2008||June 2008||July 2007|
In July 2008, the industry's aggregate incentive spending is estimated to have totaled approximately $3.29 billion, up 6.2 percent from June 2008. Chrysler, Ford and General Motors spent an aggregate of $2.1 billion, or 62.4 percent of the total; Japanese manufacturers spent $734 million, or 22.3 percent; European manufacturers spent $337 million, or 10.2 percent; and Korean manufacturers spent $167 million, or 5.1 percent.
"Beginning this month, we'll see an increase in domestic manufacturers offering zero percent interest incentives." commented Edmunds' AutoObserver.com Senior Editor Michelle Krebs. "Finance incentives are less expensive for manufacturers and as their financial institutions are getting out of leasing or adjusting their criteria for leasing, automakers will try to lure former lease customers into buying."
Among vehicle segments, large SUVs had the highest average incentives, $6,199 per vehicle sold, followed by large trucks at $5,424. Compact cars had the lowest average incentives per vehicle sold, $1,001, followed by compact SUVs at $1,473. Analysis of incentives expenditures as a percentage of average sticker price for each segment shows large trucks averaged the highest, 16.7 percent, followed by large SUVs at 16.0 percent of sticker price. Sport cars averaged the lowest, 5.5 percent, followed by compact cars at 5.6 percent of sticker price.
Comparing all brands, in July smart spent virtually nothing followed by MINI at $24 per vehicle sold. At the other end of the spectrum, Saab spent the most, $8,326, followed by Cadillac at $7,933 per vehicle sold. Relative to their vehicle prices, Saab and HUMMER spent the most, 23.4 percent and 20.1 percent of sticker price, respectively; while smart spent near zero percent and MINI spent just 0.1 percent.
About Edmunds Inc. (http://www.edmunds.com/about/)
Edmunds Inc. publishes four Web sites that empower, engage and educate automotive consumers, enthusiasts and insiders. 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 2005 and is the most-read automotive enthusiast Web site. CarSpace launched in 2006 and is an automotive social networking Web site. AutoObserver.com launched in 2007 and provides insightful automotive industry commentary and analysis. Edmunds Inc. is headquartered in Santa Monica, California, and maintains a satellite office in suburban Detroit.