New-vehicle prices are ticking up, and so are incentives as brands and auto dealers work to juice sales in an inflated market.
July’s average transaction price was up 1.5% year-over-year to $48,841, Cox Automotive reported. Though flat from June, it’s the biggest annual bump so far this year, the company said.
The manufacturer’s suggested retail price, also flat from June, rose year-over-year by nearly 2.5% – again the biggest bump of the year to date.
To soften the inflation impact, average incentives hit their highest point of 2025 at 7.3% of the ATP, up from 7% even in both June and a year earlier, Cox said.
Incentives or no, well-off consumers are steering a high-priced market, according to its analysis.
“In the face of rising prices, it is becoming more evident that the new-vehicle market is being supported by pent-up demand driven largely by high-net-worth households,” said Cox Executive Analyst Erin Keating in the monthly report. “These buyers are benefiting from the wealth effect of a healthy stock market and solid wage growth since the pandemic.”
Meanwhile, electric-vehicle segment sales jumped as consumers moved to buy before federal tax incentives end in October. They benefited from lower prices led by U.S. EV market leader Tesla, as well as increased incentives. The EV ATP fell 2% from June and 4% year-over-year to $55,689, Cox said. Tesla’s ATP was $52,949, down 9% year-over-year.
The average EV incentive was about 18% of ATP, which Cox said is a record for the segment, up a whopping 40% year-over-year. Sales matched the effort, up 20% to more than 130,000 units and estimated to be the second-best sales month on record.
