FOR IMMEDIATE RELEASE
Edmunds.com Reports True Cost of Incentives: Industry Spent at Record Levels in June; Minivans Thrive Despite Low Incentives
SANTA MONICA, CALIF. - July 6, 2004 - Edmunds.com, the premier online resource for automotive information, reported today that the average manufacturer incentive per vehicle sold in the United States reached a record high of $2,747 in June 2004, up $123, or 4.7%, from June 2003, and up $240, or 9.6%, from May 2004.
Overall, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates also reached an all-time high at $3,819 per unit in June, up $358 from May 2004. Chrysler increased its incentives spending in June by $321 to $3,569 per vehicle and gained 1.1% of market share. Chrysler's current market share of 14.5% is the highest since Edmunds.com started tracking industry trends in January 2002. In June, GM's market share receded by 1.4% to 25.6% despite increasing incentives spending for the third month in a row, raising its average by $389 to $4,312 per vehicle. Ford offered the largest monthly increase in incentives spending of any domestic manufacturer in June, raising its average by $401 to $3,328 per vehicle, but its market share remained largely unchanged at 18.1%.
Import automakers also felt the pressure In June 2004. Korean automakers spent $1,868 — up $55 for the month — and European automakers spent $2,335 — up $293 per vehicle sold. European incentives levels have not been this high since May 2002, according to Edmunds.com. Japanese automakers spent $921 per vehicle sold in June, up $22 from the prior month.
Of all brands, Mini spent the least on incentives per vehicle sold, $41, while Scion spent only $101 per vehicle and Porsche spent only $266. At the other end of the spectrum, Cadillac spent the most incentives dollars per vehicle for the fourth consecutive month, $6,325, followed by Lincoln at $5,610 and Oldsmobile at $4,939.
Among vehicle segments, large SUVs continued to offer the highest average incentives in June at $4,774 per vehicle. Other segments with high incentives were large cars at $3,754 and luxury cars at $3,680. Compact cars had the lowest average incentives at $1,706, followed by luxury sport cars at $1,931 and compact SUVs at $1,945.
Midsize SUVs have lost the most market share since June 2003, decreasing from 12.7% to 10.9%, while their average incentives increased from $2,903 to $2,949 during the same period. Meanwhile, minivans have gained the most market share, climbing from 6.8% to 7.7%, while their average incentives decreased from $2,807 to $2,678.
"The gas price hike seems to have encouraged consumers to strongly consider the practicality of minivans — a competitive segment that has recently introduced many new, appealing products," remarked Dr. Jane Liu, Vice President of Data Analysis for Edmunds.com. "Fortunately for automakers, currently minivans are about as profitable as SUVs."
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 Data Services and is licensed to third parties. For example, the company supplies over 800,000 pages of content for the auto sections of AOL and NYTimes.com, provides weekly data to Automotive News and delivers monthly data reports to Wall Street analysts. 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.