FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives: Incentives on the Rise Through Year-End
SANTA MONICA, Calif. — October 1, 2009 — Edmunds.com, the premier online resource for automotive information, estimated today that the average automotive manufacturer incentive in the U.S. was $2,557 per vehicle sold in September 2009, up $83, or 3.4 percent, from August 2009, and down $344, or 11.9 percent, from September 2008.
"After five straight months of decline, incentives are on the rise again," stated Jessica Caldwell, Director of Industry Analysis for Edmunds.com. "And now that Cash for Clunkers is over, automakers have to give consumers an incentive to buy — out of their own pockets, not the taxpayers."
According to Edmunds.com, combined incentives spending for domestic manufacturers averaged $3,514 per vehicle sold in September 2009, up from $3,232 in August 2009. From August 2009 to September 2009, European automakers decreased incentives spending by $382 to $3,354 per vehicle sold; Japanese automakers decreased incentives spending by $64 to $1,514 per vehicle sold; and Korean automakers decreased incentives spending by $658 to $1,913 per vehicle sold.
|True Cost of Incentives for the Top Seven Automakers|
|Automaker||September 2009||August 2009||September 2008|
|Chrysler Group (Chrysler, Dodge, Jeep)||$3,819||$3,405||$4,679|
|Ford (Ford, Lincoln, Mercury, Volvo)||$2,994||$3,156||$3,639|
|General Motors (Buick, Cadillac, Chevrolet, GMC, Hummer, Pontiac, Saab, Saturn)||$3,769||$3,273||$3,957|
|Honda (Acura, Honda)||$931||$902||$1,054|
|Hyundai (Hyundai, Kia)||$1,913||$2,571||$2,316|
|Nissan (Infiniti, Nissan)||$2,603||$2,568||$2,104|
|Toyota (Lexus, Scion, Toyota)||$1,516||$1,628||$1,374|
* Denotes a record
In September 2009, the industry's aggregate incentive spending is estimated to have totaled approximately $1.8 billion, down 39.4 percent from August 2009. Chrysler, Ford and General Motors spent an aggregate of $1.1 billion, or 58.6 percent of the total; Japanese manufacturers spent $471 million, or 25.1 percent; European manufacturers spent $215 million, or 11.4 percent; and Korean manufacturers spent $93 million, or 4.9 percent.
"Ford and Hyundai were able to cut back on spending this month, having gained momentum all year and getting an extra boost during Cash for Clunkers," commented Edmunds' AutoObserver.com Senior Editor Michelle Krebs. "Each of the other major automakers has its own challenges right now, and we anticipate incentives will continue to climb for most of them throughout the end of the year."
Among vehicle segments, premium sport cars had the highest average incentives, $10,128 per vehicle sold, followed by premium luxury cars at $6,551. Subcompact cars had the lowest average incentives per vehicle sold, $1,309, followed by compact cars at $1,477. Analysis of incentives expenditures as a percentage of average sticker price for each segment shows large cars averaged the highest, 13.5 percent, followed by large trucks at 12.8 percent of sticker price. Minivans averaged the lowest with 5.8 percent and compact SUVs followed with 6.9 percent of sticker price.
"High-end luxury cars are unpopular right now in part because the segment has lost many of the aspirational buyers who stretched to make the payments when the economy was stronger, and in part because some feel socially insensitive splurging on a flashy vehicle during these challenging economic times," commented Caldwell.
Comparing all brands, in September Scion spent $311 followed by Honda at $808 per vehicle sold. At the other end of the spectrum, Cadillac spent the most, $9,233, followed by BMW at $6,321 per vehicle sold. Relative to their vehicle prices, Cadillac and Pontiac spent the most, 18.6 percent and 16.8 percent of sticker price, respectively; while Scion spent 1.8 and Honda spent 3.3 percent.
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.
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.