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ALG forecasts average new vehicle transaction price up 3.3% for July 2020

ALG, Inc., a subsidiary of TrueCar, Inc. and the industry benchmark for determining the future resale value of a vehicle, projects average transaction prices (ATP) to be up 3.3% or $1,172 from a year ago but down 0.6% or $229 from June 2020

ALG, Inc., a subsidiary of TrueCar, Inc. and the industry benchmark for determining the future resale value of a vehicle, projects average transaction prices (ATP) to be up 3.3% or $1,172 from a year ago but down 0.6% or $229 from June 2020.

“While average transaction prices continue to tick up each month when compared to the same period last year, we ‘re seeing a slow decline in transaction prices month-over-month since May, as manufacturers slowly pull back incentives and inventory levels shrink for certain models,” said Eric Lyman, Chief Industry Analyst for ALG, a subsidiary of TrueCar. “Shoppers looking for specific models and trims might experience limited selection or higher price points on popular models in low inventory at dealerships. On the other hand, consumers willing to be more flexible with their consideration set can still find great deals on certain oversupplied models with incentives from manufacturers.”

“For the first time since March, automaker revenue for new vehicle sales will be up month-over-month by six percent. This is due to strategic incentive spending by the manufacturers and the continued recovery in new vehicle sales,” added Lyman.

View ALG’s sales forecast for new and used vehicles here.

ALG projects that U.S. revenue from new vehicle sales will reach more than $43 billion for July 2020, down 11.9% (based on a non-adjusted daily selling rate) from a year ago and up 6% from last month.

“We are seeing the effects that limited vehicle supply has on average transaction price for some brands. For example, Kia is seeing a year-over-year decline in their overall average transaction price which is mainly due to low inventory levels on their high demand Telluride, one of the most expensive vehicles in their lineup,” said Nick Woolard, Director of OEM and Affinity Partner Analytics for TrueCar. “Brands with more plentiful inventory levels on popular models, such as Ford, are successfully increasing their transaction prices year-over-year. On the TrueCar platform, we are seeing a mix shift from Ford shoppers from the Escape to the Explorer, leading to higher transaction prices.”

“On the Retail Health Index, which measures automaker brand health, American luxury brand, Lincoln, is showing positive momentum with an improvement in market share during the past couple of months. Their Aviator and Nautilus models continue to perform strongly against segment competitors and Lincoln’s strategic and targeted incentive spending is also contributing to their improvement on the Retail Health Index,” added Woolard.

Please click here to view the full press release

SOURCE: TrueCar

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