The Automotive Market Sees a Shift as Stellantis Brands Cut Prices While Toyota and Honda Face Strong Demand

CHICAGO, Oct. 21, 2024 /PRNewswire/ -- Cars.com Inc. (NYSE: CARS) (d/b/a "Cars Commerce."), an audience-driven technology company empowering the automotive industry, outlines shifts in the automotive industry in its September Industry Insights Report. This comprehensive report, crafted by Cars Commerce's expert data analysts, delves into macro and micro automotive market insights by analyzing supply, demand, pricing and consumer behavior data from across the company's platform, including Cars.com^?, Dealer Inspire^? and Accu-Trade^?.

"The automotive market is undergoing an adjustment as new-car prices declined, with a 1.5% year-over-year drop in September driven by significant inventory surpluses, particularly among brands like Jeep, Ram and Dodge, which are sitting on dealer lots an average of 131 days — well above the market average of 72 days," said David Greene, industry and marketplace analytics principal, Cars Commerce. "While the average price of a new car is steady around $49,000, Cars.com's New Car Price Index fell almost 5 ppts YoY, showing some of the impacts of available incentives and discounting for select models. Meanwhile, the used-car market continues to hold steady since early 2024, but average prices are down 5% year over year, dropping to $28,882, ultimately offering more affordable options for price-conscious consumers."

Honda, Toyota See Price Increases While Stellantis Faces Price Declines

In September, Jeep's average new car list price fell by 5%, Ram by 7% and Dodge by 3%, signaling a challenging landscape for these brands that typically carry above-average prices. In addition, all of these Stellantis brands index below-average in Cars.com's New Car Pricing Index, which estimates the full cost to buy and finance a vehicle, inferring that Stellantis deployed heavy customer incentives and discounts to help sell down inventory. Stellantis also recently cited production cuts as a factor for lower shipments in the third quarter to address the excess supply of vehicles. Despite these pressures, the overall average price of new vehicles remained steady at approximately $49,000, while brands like Toyota and Honda defied the trend. These brands saw price increases of 3% and 8% YoY, respectively, as strong demand kept prices elevated.

Seasonal Trends and Inventory Adjustments

The new-car market in September saw a seasonal dip in searches, down 5% month over month, following typical post-Labor Day patterns. The impact of Hurricane Helene in the southeastern U.S. (Florida, Georgia, Tennessee, Virginia and the Carolinas) further contributed to September's slowdown, with demand down 7% week over week starting Sept. 26 in affected markets compared to 1% WoW for the rest of the country. The full effects on demand, sales and inventory — especially due to production halts at some plants — won't be fully visible until the end of October when the complete impact of Hurricane Helene and the fast-following Hurricane Milton is assessed. However, inventory levels in September remained elevated for now, up nearly 30% YoY as manufacturers like Ford, Chevrolet and Honda replenished stock after 2023's chip shortage recovery.