New vehicle prices in the US remained below the Manufacturer's Suggested Retail Price (MSRP) for the fifth consecutive month in May 2023, averaging $48,528. This price is $410 below the sticker price, while a year ago, the average price was $637 above the MSRP. The average transaction price of a new vehicle increased 0.5% month-on-month and 3% year-on-year. Auto manufacturers' incentive spending also rose, averaging $1,914.
Meanwhile, the popularity of leasing battery-electric vehicles (BEVs) has surged, partly due to the introduction of a federal tax credit. Any leased BEV qualifies for the tax credit, which the lessor must pass on to the consumer. The rate of leased BEVs rose from 10% in December 2022 to 41% in April 2023. This trend may increase as BEVs become more affordable, opening the door for those who previously couldn't afford them.