New-vehicle prices rose sharply in December 2024, with average transaction prices (ATPs) reaching $49,740, according to Cox Automotive’s Kelley Blue Book. This marks a 1.3% increase year over year and a 1.5% rise from November 2024, driven by strong sales of high-priced vehicles and luxury models.
"It was a December to remember, in terms of both sales volumes and prices," said Erin Keating, executive analyst at Cox Automotive. "Consumer sentiment and confidence were on the rise, and vehicles -- especially luxury ones-- are emotional purchases. With favorable market conditions, it’s no surprise we saw increases in both prices and sales volumes."
Surge in High-Priced Vehicle Sales
December typically sees a surge in luxury vehicle sales, contributing to higher ATPs. Last month, approximately 5.6% of all new-vehicle sales, or 84,000 units, exceeded $80,000 -- a record-breaking figure for the industry. Popular models in this price range include the Land Rover Range Rover, Cadillac Escalade, BMW X7, GMC Yukon and Tesla Cybertruck.
Additionally, full-size pickup trucks, which averaged $64,261, played a role in elevating ATPs, with a segment volume of more than 223,000 units.
Brand-Specific Trends
Several brands experienced notable changes in ATPs. Mitsubishi led the decline with a 12% year-over-year drop, while Buick and Volkswagen saw decreases of 7% and 6%, respectively. Stellantis brands, including Chrysler, Dodge, Jeep and Ram, also reported declines as the automaker worked to manage high inventory levels.
Conversely, Cadillac and Tesla saw significant price increases, with ATPs rising 13% and 10.5%, respectively. Infiniti also reported an 8.1% year-over-year increase, bringing its average transaction price to $65,667.
Electric Vehicles Drive Growth
The EV market also contributed to rising ATPs. EV prices averaged $55,544 in December, up 0.8% year over year and 1.1% from the previous month. Sales incentives remained strong, averaging 14.3% of ATP, which equates to more than $6,700 per sale. These incentives played a critical role in pushing EV sales past 1.3 million units in 2024, setting a new annual record.
Incentive Trends
Incentives across all vehicle categories remained steady at 8.0% of ATP in December, translating to approximately $3,958 per transaction. Entry-level luxury cars and compact SUVs offered the highest incentives, at 10% and 9.7% of ATP, respectively. Volkswagen, Ram and Nissan led in incentive offerings, all exceeding 13% of ATP, while Toyota, Land Rover and Porsche reported some of the lowest incentives in the industry.
As the industry transitions into 2025, consumer optimism and evolving vehicle trends suggest that ATPs may continue to climb, especially for luxury and EV segments.
