The new-vehicle average transaction price was $48,699 in April, a 2.5 percent increase from March according to Cox Automotive’s Kelley Blue Book. This price increase is more than double the average historical monthly gain of 1.1 percent and is surpassed only by April 2020’s 2.7 percent jump during pandemic-driven supply constraints.
The year-over-year ATP increase was a more moderate 1.1 percent, which is still below long-term trends of 3 percent annual price growth. The subdued year-over-year change is partially attributed to inventory stabilization, which has kept pricing relatively flat since 2023. However, it’s unclear how long that will last as the month-over-month increase is much more indicative of the impact tariffs have begun to have on the entire industry.
“Ever since President Trump announced auto tariffs 47 days ago, the cost of new cars has been steadily climbing,” said Erin Keating, Executive Analyst, Cox Automotive. “Even though there was a surge in shopping and sales early on, the manufacturer’s suggested retail prices haven’t budged.”
For now, rising prices have not stopped consumers from racing to the dealership. April had a seasonally adjusted annual rate of 17.3 million units, the highest for the month since 2021.
EV Prices Continue to Rise
The average transaction price for new EVs was $59,255 in April but saw a much smaller change month over month than the market average. Prices were up only 0.2 percent from March. However, they were still 3.7 percent higher year over year.
Meanwhile, incentives on EVs, which once helped mitigate the higher-than-average prices, declined in April, dropping to 11.6 percent of ATP. This marks the second straight month of decreases, continuing to drop from November 2024’s peak of 13.9 percent. This is not an EV specific trend though, as sales incentives are on the decline everywhere. This month they sat at 6.7 percent for all new vehicles, down from 7 percent in March.
Year-to-date, total EV sales remain heathy, rising 5.4%, but were down by 6 percent month over month in April. Tesla, which sold more than 45,000 EVs in April for its best month of 2025, had an average ATP of $56,120. While the brand’s refreshed Model Y drove much of this success, the higher-priced Cybertruck failed to crack 2,000 units for the first time this year. It had an ATP of $89,247 for the month.
Tariff Effects Take Hold
A central theme in April was the growing impact of tariffs on certain automakers and vehicle segments. Compact SUVs, which are highly exposed to import tariffs, remained steady at $36,416, but incentives and discounts fell to 7.8 percent of ATP. This is down from 8.2 percent in March. Since April 2024, Compact SUV incentives have averaged 9.1 percent.
Premium brands like Porsche and Land Rover reported record-high ATPs exceeding $113,000 in April, as consumers rushed to secure vehicles before future cost increases take hold. Both brands rely heavily on imports and are facing further price increases as pre-tariff inventory begins to dwindle.
Automaker Strategies in a Volatile Landscape
As the market continues to fluctuate, manufacturers are deploying varied strategies to stay competitive. Brands like Ford have emphasized messaging about price stability and domestic production. Ford leaned into its “built in America” campaign, holding prices and incentives steady across most models in April. Its Mexico-built Maverick pickup bucked industry trends with increased incentives and lower prices, setting a record at 20,183 units sold for the month.
On the other hand, luxury automakers are adjusting their pricing and incentives to optimize profitability. Audi, Land Rover, and Volvo saw increased ATPs while reducing incentives, whereas Acura and BMW pursued the opposite strategy, offering higher discounts to sustain volume.
“The pricing landscape is varied depending on the automaker, car segment and specific models,” said Keating. “Some are cutting incentives, others are in high demand, and the supply isn’t evenly distributed across the board.”
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