Most new car buyers paying over sticker price, especially on some brands: See the list – Detroit Free Press

February 15, 2022 by No Comments


General Motors and Ford Motor have warned dealers to not charge excessive fees above sticker, but new data show the trend is across the industry — in some cases topping GM and Ford brand prices.

In January, buyers paid above the manufacturer’s suggested retail price in 82.2% of new-vehicle purchases compared with 2.8% in January 2021, Edmunds.com, a car shopping analyst and data company, said in a report it released Tuesday. 

The high prices  are due, in large part, to the industry’s unusually low new-car inventory amid a global shortage of semiconductor chips, which are used in many car parts. Adding to that is the high consumer demand for new vehicles especially as 3.9 million vehicles are due to come off lease this year.

More: Everything you need to know about the chip shortage that’s plaguing automakers

“The fact that an overwhelming majority of consumers are paying above sticker price would have been unthinkable even just a year ago,” said Jessica Caldwell, Edmunds’ executive director of insights. “This is, in part, driven by affluent consumers being willing to shell out more cash to get the vehicles that they want, but there’s also a vast population of individuals who are being forced to do so simply because they need transportation.”

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On average, a car buyer paid $728 above MSRP in January.

Last year at this time, a car buyer would have gotten a new car at an average discount of $2,152. In January 2020, the average transaction price was $2,648 below sticker.

Both Ford and GM have tried to mitigate the practice of tacking on excessive surcharges for popular and hard-to-get new vehicles.

In early January, Ford warned its dealers not to upsell reservations for the popular Ford Lightning F-150 EV truck.Some were charging more than $10,000 surcharges above sticker.  The automaker also wanted customers to sign a contract preventing them from reselling it within a year.

Ford did not immediately provide a comment Tuesday on the status of its work with dealers on pricing. 

More: Ford F-150 Lightning dealer backs down from $10,000 markup

After Ford’s move, GM issued a letter on Jan. 18 to its dealer body. In it, GM President of North America Steve Carlisle warned dealers that GM has the right to withhold allocation of the future Corvette Z06 and the new EVs GM is bringing to market or take “other recourse” against dealers who are charging money above the reservation amounts in light of the current shortfall of new vehicles.

GM had no update Tuesday on its continued efforts to prevent some dealers from charging excessive markups  for certain new vehicles, said GM spokesman Sabin Blake.

More: As GM drops Chevy Spark, here are the most affordable vehicles from Detroit 3

“All eyes have been on Ford and GM since they both publicly called for their dealers to stop charging over MSRP for vehicles,” Caldwell said. “Of …….

Source: https://www.freep.com/story/money/cars/2022/02/15/car-buyers-msrp-sticker-price/6797845001/

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