Photo: David McNew/Staff (Getty Images)
2022 was a bad time to buy a car. So is 2021. And most of 2020. But the good news is that seems to be changing for the better. Buyers are still unlikely to land some of the best deals available before the pandemic hit, but at least the days of paying MSRP for the privilege of owning a basic family vehicle seem to be over.
CNN reports that around this time last year, about 80 percent of new car buyers paid through stickers. Today, however, that number has dropped to 36 percent. And while last spring new cars sold for an average of $700 over MSRP, in December 2022 new car buyers paid an average of $300 under MSRP. But while that’s good news for consumers, CNN was quick to point out that it still pales in comparison to the $2,600 you could save in 2019.
What’s not so good news for consumers is the average transaction price. It was reportedly just under $50,000 in December. That’s an increase of about $10,000 and more than 25 percent compared to 2019. Thanks to the chip shortage, automakers have focused on building better-equipped vehicles with higher profit margins. So now you might be able to get a Kia Telluride at or under MSRP, but you might still have trouble finding a base model Telluride LX.
Not all retailers have also given up calculating the MSRP. Looking for Kia Tellurides locally, one dealer listed them for a few hundred dollars below MSRP, while another is still asking $10,000 over the sticker. You can also expect to continue paying retailer markups if you’re in the market for something with limited availability. So even if you can find a new Honda Civic for less than MSRP, you probably won’t have any luck finding a similar deal on a Civic Type R.
But at least things are going up. Automakers are building more cars, dealer inventories are up 83 percent compared to early 2022, used car prices are falling, and over the next year the auto market could indeed look like it did before the pandemic. We hope.