The average transaction price for a new GMC vehicle bucked a general trend of declining prices in the U.S. automotive sector, surging 11 percent year-over-year in September and reaching $66,002 versus its $59,398 in September 2022.
In month-over-month terms, new vehicle ATP for Big Red rose 4.9 percent relative to the average $62,913 a buyer paid for one of its offerings in August 2023, Cox Automotive and Kelley Blue Book research indicates.
The sharp rise in GMC ATP runs contrary to the American auto market as a whole, with average vehicle prices falling 0.7 percent year-over-year and 3.4 percent since early January. While GM prices increased, ATP growth was much weaker for the aggregate of GMC, Chevy, Buick, and Cadillac than for GMC alone. The General’s overall September ATP inched up 1 percent year-over-year, from $52,226 to $52,736, while only gaining 1.2 percent compared to August.
Big Red’s pricing power appears to be driven by the dynamo of AT4 and Denali trim level sales. The brand’s Global Vice President Duncan Aldred remarked that customers want “a more rugged look and more capability as well,” with the Denali, Denali Ultimate, AT4, and AT4X sub-brands accounting for 51 percent of brand sales in August 2023.
Growing inventory and increasing incentives are responsible for the declining ATP in the overall automobile market. Cox research manager Rebecca Rydzewski pointed out that “we’re seeing average transaction prices dip below $48,000 for the first time in more than a year.”
Turning to the potential impact of union strikes against the Detroit Three, Rydzewski noted that if “the UAW strike is short-lived, current inventory levels are healthy enough to prevent any significant impact on consumer prices.” GM, however, is the member of the trio with the least inventory, prompting it to reduce its incentives while Ford and Stellantis bolster theirs.
Overall, industry incentives were 4.9 percent of ATP in September, while GM as a whole dropped its incentives from 4.7 percent in August to 4.0 percent last month. Specific incentive numbers weren’t available for the GMC brand individually. Cross-town rival Stellantis hiked its incentives 7.3 percent above those it offered in August, while the Blue Oval raised incentives by 5.2 percent.
While luxury vehicles still hold an 18.5 percent market share in September, luxury ATP fell 6.2 percent year-over-year. The average luxury transaction of $62,342 is very close to the AT4 and Denali boosted ATP of GMC. Meanwhile, EV prices fell 2.9 percent month-over-month and 22.4 percent year-over-year.
Both declines largely resulted from Tesla’s strategy of slashing prices to encourage sales, which dropped the EV automaker’s ATP by 24.8 percent since September 2022. Tesla’s EV market share is also down to just 50 percent, prompting another Cox director, Stephanie Valdez-Streaty, to note there is “more choice” in EVs, with “15 new EV models for sale that were not available a year earlier.”
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Comments
That tells you the people who are getting into a vehicle they really cannot afford got suckered into going over their head and the people who have the bank and price is not a concern.
The people who are on a tighter budget are looking at other brands.
I’m not surprised! Lack of availability and the strike means longer lack of availability. I just bought a new Yukon because they had it come in. I had a 24 on order and canceled it.
Full msrp and $700 dealer fee. Ram and Ford are discounting their prices. 50 years with a GM dealer and I didn’t look elsewhere.
This has to be Misinformation. Bidenomics has the price of everything going down. Haven’t you been listening to the President? Prices are dropping and everyone is better off than they were 3 years ago.
Hey Rhian, maybe this increase is directly related to sales of the new Hummer EV? Sales of the Hummer increased significantly in Q3. Did almost all Hummer sales actually occur in September?
This seems much more logical than suggesting the increase is related to Denali’s and AT4s. While those models do account for a large portion of GMC sales, there would have to be a huge increase in Sierras and Yukons to trigger that much of an increase and I don’t recall there being that much of a change.