TrueCar.com: Aggressive Incentives Remain in Many Segments
SANTA MONICA, Calif. — TrueCar.com analysts believe automakers are attempting to keep any economic recovery momentum going by continuing to offer generous incentive packages and discounts from MSRP on 2010 vehicles.
According to the site's TrueTrends Report for April that aggregates this data, the average discount off of a new vehicle is projected to be at least 6.5 percent during the next 30 days. That figure climbs even higher for some specific brands such as Ford and Hyundai, as well particular vehicles like the Mazda Tribute and Chrysler PT Cruiser Classic.
TrueCar.com analysts highlighted which vehicles have the best Price Flex Score, a composite reading of total incentives, greatest percentage below MSRP, greatest price drops and days in inventory.
They gave a score of 100 to the previously mentioned Mazda Tribute and Chrysler PT Cruiser Classic as well as the Hyundai Elantra. Right behind at 99 were the Acura ZDX, the Honda Insight and the Hyundai Elantra Touring.
Vehicles that TrueCar.com gave a Price Flex Score of just 1 included the Chevrolet Suburban and GMC Acadia. A score of 2 was handed out to the Audi A5, the Cadillac DTS and GMC Terrain.
Analysts reiterated that the TrueCar Price Flex Score measures how elastic the transaction price is for a particular model. A high Flex Score means a possibility of a great swing (high or low) in the price from MSRP, while a low Flex Score means the price is far less negotiable and that the transaction price range is much narrower.
When looking at specific models with the highest discount off of MSRP, TrueCar.com found that the Chevrolet Cobalt led the way with a 20-percent reduction. Getting discounts of 19 percent are the Hyundai Sonata and Jeep Grand Cherokee, while the site spotted an 18-percent reduction for the Jeep Commander.
Other noteworthy MSPR discounts analysts mentioned were 17-percent reductions for the Ford Ranger and Focus as well as Chevrolet Malibu.
Looking at the discounts by brand, TrueCar.com revealed that Ford leads the way at 14 percent. Handing out 11-percent MSRP reductions are Hyundai, Chrysler, Chevrolet and Mercury.
Site analysts also found another revealing trend about how deeply automakers want to stimulate the economy — incentives are on the way up for luxury brand vehicles, too.
One of many examples they shared was $12,500 in dealer cash offered for the BMW M6. Also mentioned was $6,000 in cash available for the Infiniti M45 and $5,000 for the Volvo XC70.
Furthermore, the top five vehicles with the highest month-over-month decline in price all were luxury units. This group included the BMW 5 Series (-$1,471), Mercedes-Benz S-Class (-$1,469), Lexus LX570 (-$934), Land Rover Range Rover Sport (-$902) and BMW X5 (-$719).
Finally, TrueCar.com determined the new vehicles that have been in dealer inventory the longest. Leading this category was the Hyundai Sonota at 131 days, the only vehicle above 100. The rest of the top five units included the Ford Mustang, BMW 535i, Ford Transit Connect and Kia Forte.
TrueCar.com wrapped up its projections by noting April 26 as the best day to buy a vehicle and May 2 as the worst day during the report time span.
"The relative economic recovery we have seen so far this year has already started improving consumer demand for cars," explained Jesse Toprak, vice president of industry, trends and insights for TrueCar.com.
"As demand increases — with the consumers who have postponed their car purchase for the last couple of years due to economic uncertainty — we expect prices to start stabilizing, most likely in the second half of the year," Toprak continued.
"This means that the discounts we see a few months from now will probably not be as generous as those we have today," he added. "Bottom line: If you are in the market, buy now."