Vehicles are expensive these days, especially new cars and trucks. We live in a world where an entry-level Honda Civic, which used to be a super-affordable small car, starts at around $25,000; you can also push a Ford F-150 to 80 grand – or more – without much effort. This madness is reflected in the average new vehicle transaction price (ATP), something that is closely tracked by Kelley Blue Book.
The Average Transaction Price Is Holding Steady
According to a recent report published by the automotive research and vehicle price-tracking firm, the average ATP for new vehicles was $47,462 last month. For many motorists, that is a wince-inducing figure, but if there’s any good news it’s that the number is down slightly from February, where the ATP was $47,577, a modest $115 more than in March.
The automotive brands that saw the steepest price increases were Infiniti, Lincoln, Mazda, Porsche, and Volvo, with Infiniti’s prices growing by nearly 19 percent. Curiously, Jeep, Ram, and Mercedes-Benz saw their ATPs drop compared to March 2024, with Jeep’s falling the most at 10.6 percent.
- Average new vehicle transaction prices in the U.S. last month were $47,462
- This is a month-over-month increase of just $115
- Some core brands saw steep ATP increases, though a few saw them decline
- Electric vehicles are still appreciably more expensive than conventional cars and trucks
Underscoring the expense of modern driving, according to Kelley Blue Book, just 26 new vehicles in the U.S. had average transaction prices of less than $30,000. This includes models like the Nissan Sentra, Kia Soul, Mazda3, and
, to name a few. Combined, these nameplates account for around 14 percent of total U.S. sales, though there could be a problem. Reportedly, these models are “highly vulnerable to the new tariff policy adopted by the White House. Many vehicles in the category are assembled outside the U.S. and are now subject to 25 percent tariffs,” which is bad news for value-conscious drivers.
Sales incentives clocked in at about 7 percent of ATP in March, roughly the same as in the previous month, though much less than in November and December 2024. Overall, this equates to about $3,339. Despite the flat incentives and pricing, the sales of new vehicles surged forward, likely spurred on by drivers hoping to get a new ride before tariffs make them unaffordable. Deliveries hit nearly 1.6 million units in March, a month-over-month increase of almost 30 percent.
Electric Vehicles Are Getting More Expensive
Electric vehicles have a pricing problem, too, and it only appears to be getting worse. The March ATP for EVs is estimated to be $59,205, a year-over-year increase of seven percent. That’s also a $2,190 jump compared to February.
Fanning the flames, “EV ATPs in March were higher by nearly 25 percent as the gap between new ICE (internal-combustion engine) and new EV grows wider,” Kelley Blue Book reports. Incentives for electrics, at least, are far higher than the industry average, clocking in at around 13.3 percent last month.
Bad News For Drivers
If you’re in need of a new vehicle, it might be wise to purchase one sooner than later. “All signs point to higher prices this summer, as existing ‘pre-tariff’ inventory is sold down to be eventually replaced with ‘tariffed’ inventory,” said Erin Keating, executive analyst at Cox Automotive, parent company of Kelley Blue Book. “How high prices rise for consumers is still very much to be determined, as each automaker will handle the price puzzle differently. Should the White House posture hold, our team is expecting new vehicles directly impacted by the 25 percent tariff to see price increases in the range of 10 to 15 percent,” the number-cruncher added.
But wait, there’s even more bad news for consumers! “In addition,” Keating also said, “considering the market dynamics, we also anticipate seeing at least a 5 percent increase in prices of vehicles not subjected to the full 25 percent tariff. There is no way around it: Tariffs are going to push new-vehicle prices higher in the U.S.” Again, if you need a fresh set of wheels and were considering a new vehicle, it’s wise to buy sooner than later.
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