Analysts say a surplus of outgoing model year vehicles from domestic automakers is driving discounts for new-car shoppers this summer
Santa Monica, Calif., May 22, 2024 (GLOBE NEWSWIRE) — Good news for car shoppers seeking a reprieve from scorching new vehicle costs this summer: Outgoing model year (2023MY) inventory available on dealer lots across the country means that discounts should be easier to find this Memorial Day weekend. According to May data[1] from the car shopping experts at Edmunds, 2023MY vehicles are:
- Sitting on dealer lots at pre-pandemic levels. The share of 2023MY vehicles on dealer lots nationwide climbed to 6.8%. In May of 2023, the share of 2022MY vehicles on dealer lots was 5.4%, and in May of 2022, the share of 2021MY vehicles was 3.7%. In May of 2019, the share of 2018MY vehicles was 6.7%.
- Being listed for thousands of dollars below MSRP on average. The average discount for a 2023MY vehicle was $4,147[2], compared to $1,741 for a 2024MY vehicle. In 2023, the average discount for a 2022MY vehicle was $1,919. In 2022, the average discount for a 2021MY vehicle was $357, and in 2019, the average discount for a 2018MY vehicle was $4,600.
- More likely to command lower interest rates when financed by qualified shoppers. More than 1 in 4 (26.9%) purchases of 2023MY vehicles financed at dealerships commanded an average annual percentage rate (APR) of 1.99% or less, compared to just 4.1% of financed 2024MY vehicle purchases.
“Supply chain disruptions and limited inventory left little to be excited about in summer holiday car shopping the past few years, but discounts on outgoing model year vehicles this Memorial Day weekend are a bright spot for consumers in an otherwise challenging market,” said Jessica Caldwell, Edmunds’ head of insights. “For dealers and automakers, the trend serves as a moment of caution surrounding the old habits of overproduction and inventory glut. It’s also a reminder that the expensive vehicles now being discounted were strong sellers one to two years ago, showing just how significant high interest rates are in today’s market.”
Domestic Brands Offer Consumers the Best Chance of Discounts This Holiday Weekend
Edmunds analysts note that brands from Detroit automakers are seeing the greatest buildup of inventory on dealer lots and therefore could offer the biggest discounts for car shoppers this holiday weekend. According to Edmunds data from May, Dodge, Chrysler and Buick topped the list of makes with the highest concentration of 2023MY vehicle listings nationwide at 52.6%, 38.4% and 17.6%, respectively. These brands listed for an average discount of $6,753, $6,252 and $4,256, respectively, for their 2023MY vehicles. Japanese automakers Toyota, Subaru and Honda topped the list of makes with the smallest share of 2023MY vehicle listings nationwide, at 0.8%, 0.8% and 0.6%, and commanded average discounts of $1,337, $1,450 and $786, respectively.
Makes Ranked by Highest Share of Outgoing Model Year (2023MY) Vehicle Listings on Edmunds
| Make | Share of 2023MY Vehicles | Average Discount for 2023MY Vehicles (difference between average MSRP and average dealer listing price)
|
| Dodge | 52.6% | $6,753 |
| Chrysler | 38.4% | $6,252 |
| Buick | 17.6% | $4,256 |
| Ford | 14.7% | $3,149 |
| Lincoln | 12.9% | $4,625 |
| Ram | 8.9% | $4,171 |
| Jeep | 8.5% | $6,160 |
| Mercedes-Benz | 8.2% | $316 |
| Jaguar | 7.6% | $4,185 |
| Genesis | 6.6% | $3,131 |
| Land Rover | 5.7% | $1,046 |
| Mitsubishi | 4.5% | $2,677 |
| Nissan | 4.2% | $3,745 |
| INFINITI | 3.7% | $5,781 |
| GMC | 3.4% | $3,068 |
| Volkswagen | 3.2% | $5,221 |
| Volvo | 3.1% | $5,354 |
| Hyundai | 3.0% | $2,499 |
| Porsche | 2.5% | $1,416 |
| Chevrolet | 2.4% | $1,347 |
| Kia | 2.4% | $2,568 |
| Acura | 1.8% | $559 |
| Audi | 1.6% | $2,251 |
| Lexus | 1.6% | $664 |
| BMW | 1.3% | $285 |
| Cadillac | 0.9% | $2,574 |
| MINI | 0.9% | $683 |
| Mazda | 0.8% | $1,025 |
| Toyota | 0.8% | $1,337 |
| Subaru | 0.8% | $1,450 |
| Honda | 0.6% | $786 |
Outgoing New Models Are Enticing, But They’re Not for Everyone
“Research is critical when considering outgoing model year new vehicles as they can represent notable savings and in some cases don’t sacrifice on vehicle features when compared to current model year models, leaving funds for peace-of-mind products like extended warranties and wheel/tire protection,” said Ivan Drury, Edmunds’ director of insights. “That said, while purchasing a prior model year vehicle can offer an opportunity to lock in a discount, it might not be an ideal investment for all shopper types. Consumers who prefer to swap their vehicles every few years may want to look elsewhere as these new outgoing models experience heavier immediate depreciation compared to new vehicles from the current model year.”
For more general tips on how to shop for a car on a holiday weekend, Edmunds experts have put together a helpful guide that can be found here. Car shoppers can start their search for new vehicles at local dealerships on Edmunds here.
About Edmunds
Edmunds guides car shoppers online from research to purchase. With in-depth reviews of every new vehicle, shopping tips from an in-house team of experts, plus a wealth of consumer and automotive market insights, Edmunds helps millions of shoppers each month select, price and buy a car with confidence. Regarded as one of America’s best workplaces by Newsweek, Fortune, Great Place to Work and Built In, Edmunds is based in Santa Monica, California. Follow us on TikTok, Twitter, Facebook and Instagram.
[1] Data pulled from Edmunds’ database of dealer partners, reflective of available inventory on May 19, 2024
[2] Average discount was calculated as the difference between the average MSRP and average dealer listing price for all vehicles
CONTACT: Talia James-Armand Edmunds 310-491-8738 pr@edmunds.com
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