FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives for September
SANTA MONICA, Calif. — October 1, 2008 — Edmunds.com, the premier online resource for automotive information, estimated today that the average automotive manufacturer incentive in the U.S. was $2,801 per vehicle sold in September 2008, down $1, or 0.04 percent, from August 2008, and up $444, or 18.8 percent, from September 2007.
"Although up overall from last year, incentive levels remained flat from August to September despite worsening economic conditions and weak auto sales," stated Jesse Toprak, Executive Director of Industry Analysis for Edmunds.com. "The high incentive costs of heavily discounted 2008 models are being offset by the low incentive costs of the 2009 models entering the marketplace".
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 $4,049 per vehicle sold in September 2008, up from $4,000 in August 2008. From August 2008 to September 2008, European automakers increased incentives spending by $344 to $2,910 per vehicle sold; Japanese automakers decreased incentives spending by $180 to $1,494 per vehicle sold; and Korean automakers increased incentives spending by $18 to $2,062 per vehicle sold.
|True Cost of Incentives for "Big Six" Automakers|
|Automaker||September 2008||August 2008||September 2007|
In September 2008, the industry's aggregate incentive spending is estimated to have totaled approximately $2.94 billion, down 15.8 percent from August 2008. Chrysler, Ford and General Motors spent an aggregate of $1.98 billion, or 66.7 percent of the total; Japanese manufacturers spent $639 million, or 21.6 percent; European manufacturers spent $238 million, or 8.0 percent; and Korean manufacturers spent $108 million, or 3.7 percent.
"Chrysler's decision to exit leasing is not saving the automaker money in the short term," commented Edmunds' AutoObserver.com Senior Editor Michelle Krebs."Chrysler is offering record levels of cash and finance incentives to attract buyers, including former lease customers, but consumers are not responding."
Among vehicle segments, premium luxury cars had the highest average incentives, $9,298 per vehicle sold, followed by large trucks at $5,820. Subcompact cars had the lowest average incentives per vehicle sold, $484, followed by compact cars at $770. Analysis of incentives expenditures as a percentage of average sticker price for each segment shows large trucks averaged the highest, 17.9 percent, followed by large SUVs at 14.0 percent of sticker price. Subcompact cars and premium sport cars tied for the lowest at 3.1 percent of sticker price.
Comparing all brands, in September MINI spent $39 followed by Scion at $171 per vehicle sold. At the other end of the spectrum, HUMMER spent the most, $9,251, followed by SAAB at $5,797 per vehicle sold. Relative to their vehicle prices, HUMMER and Chrysler spent the most, 23.7 percent and 19.3 percent of sticker price, respectively; while MINI spent just 0.2 and Scion spent 1.0 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.