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New-Vehicle Prices Hit a Record-High in June, EVs Selling for $66,000 on Average

Inflation, low inventories, and a strong luxury share (18% of car sales) have pushed new-vehicle prices to a record-high in June. Electric vehicles registered one of the highest price increases of all segments, with an average transaction price of $66,000.
New-vehicles prices at a new record-high in June, EVs selling for $66,000 on average 8 photos
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For years we’ve been comforted with the idea that electric vehicles would become more affordable as the technology becomes widespread and more carmakers join the competition. Despite that, we’ve seen the exact opposite this year: EVs getting out of reach for all but the wealthiest car buyers. No wonder the price remains one of the biggest complaints about electric vehicles.

According to a recent Kelley Blue Book report, the average EV prices have increased by 13.7% in June compared to the same month a year ago. This is not far from the broader car market, which was up 12.7% compared to June 2021. Electric vehicles have firmly entered the luxury vehicle territory with an average transaction price (ATP) of $66,000. Being the market leader, Tesla had a significant contribution, even though it increased prices by only 11.8% year-over-year.

The average price paid for a new vehicle in the U.S. surpassed the $48,000 mark for the first time in June. The average transaction price rose 1.9% from May and 12.7% from June 2021. There are several contributing factors to the price increase, which stands for all vehicles, electric or not. The most important is the imbalance between the supply and demand, with the dealers speculating tight new-vehicle inventories. Markups have become the norm, with new cars from Honda, Kia, and Mercedes-Benz transacting on average between 6.5% and 8.7% over MSRP.

Inflation is another contributing factor, and with components and raw materials prices skyrocketing, it was only a matter of time before they would get into the final product. We’ll probably see some relief in the second part of the year as the car industry sorts out the chip shortages and supply chain issues, and the inflation will hopefully calm down. Besides that, increased EV production and battery technology advances should also pressure the prices to decrease.

 
 
 
 
 

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