FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives: Import Automakers Offered Record Incentives in December
SANTA MONICA, Calif. — (Jan. 5, 2004) — Edmunds.com, the premier online resource for automotive information, reported today that the average manufacturer automotive incentive in the United States was $2,512 per vehicle sold in December 2004, up $57, or 2.3%, from December 2003, and up $117, or 4.9%, from November 2004.
"As we close the books on 2004, we are confident that we have not seen the end of generous auto incentives," stated Dr. Jane Liu, Vice President of Data Analysis for Edmunds.com. "However, unlike the past's traditional cash and financing incentives, the future will likely show us more creative offers, like Volkswagen's new In The Car program that covers car insurance for the new owners' first year."
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.
Overall, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates averaged $3,420 per vehicle sold in December, up $41 from November 2004. Chrysler lowered incentives spending for the third straight month, by $104 to $3,325 per vehicle sold in December, and lost 0.7% market share, falling to 13% of the U.S. market. Ford also decreased incentives spending for the third straight month, by $217 to an average of $2,924 per vehicle sold in December, while its market share fell by 0.5% to 17.4%. GM increased incentives spending in December by $269 to $3,789 and its market share increased 2.6% to 27.2%.
In December 2004, Korean automakers increased incentives spending by $26 to $1,853 per vehicle sold, European automakers increased incentives spending by $17 to $1,781 per vehicle sold and Japanese automakers increased incentives spending by $188 to $1,076 per vehicle sold. These are record highs for import automakers, according to Edmunds.com's research.
From November to December, Korean, European and Japanese manufacturers lost market share, going from 4.44% to 3.74%, from 7.53% to 7.33% and from 31.5% to 31.0%, respectively. Domestic manufacturers gained market share during that period, rising from 56.3% to 57.6%.
Comparing all brands in December, Mini and Porsche spent virtually nothing on incentives, while Scion spent only $134 per vehicle sold. At the other end of the spectrum, Lincoln was the biggest spender at $5,419 in December, followed by Cadillac at $4,690 and Pontiac at $4,465 per vehicle sold.
Among vehicle segments, in December, large SUVs continued to offer the highest average incentives, $4,179 per vehicle sold. Other segments with high incentives were large cars at $3,494 and large trucks at $2,990 per vehicle sold. Compact cars had the lowest average incentives at $1,391, followed by sports cars at $1,782 and luxury sports cars at $1,888 per vehicle sold.
Large SUVs have lost the most market share since December 2003, decreasing from 7.2% to 6.3%, while large cars have gained the most market share during that period, up from 4.6% to 5.9% 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 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.